The
Telecommunications Legislation Amendment (Universal Service Reform)
Bill 2011 forms part of a package of legislation to achieve
continuity of key telecommunications safeguards in the transition
to the National Broadband Network (NBN). The other bills in the
package are the Telecommunications Universal Service Management
Agency Bill 2011 (the TUSMA Bill) and the Telecommunications
(Industry Levy) Bill 2011 (the Industry Levy Bill).

The TUSMA
Bill:

· provides
for the establishment of the Telecommunications Universal Service
Management Agency (TUSMA) as the statutory agency that will have
the responsibility for the effective implementation and
administration of service agreements that deliver universal service
and other public policy telecommunications outcomes

· provides
for the Minister, subject to the scrutiny of Parliament, to set the
standards, rules and minimum benchmarks that would apply to the
universal service components of the Government’s agreement
with Telstra, and any future contracts or grants entered into by
TUSMA, and

· sets out
arrangements for consolidating the two current Universal Service
Obligation (USO) and National Relay Service (NRS) industry levy
regimes into a single regime to contribute funding towards
TUSMA’s costs.

The main
purpose of this Bill is to make consequential amendments to
telecommunications and related legislation (including the Telecommunications
Act 1997, the
Telecommunications (Consumer Protection and Service
Standards) Act 1999 , and the Australian Communications and
Media Authority Act 2005 ) as a result of the new legislative
scheme in the TUSMA Bill. In particular, this Bill includes
provisions which, if specified pre-conditions are met, would enable
the progressive removal of the current USO for standard telephone
services and payphones. The regulated USO obligation is intended to
be replaced by the contractual arrangements in the TUSMA
Bill.

The
Industry Levy Bill imposes a levy that will provide for relevant
industry participants to contribute to the costs of TUSMA that are
not met by dedicated Budget funding.

Policy
objectives

Current
arrangements

Currently,
the main public interest telecommunications services regulated
under telecommunications legislation are the USO (for standard
telephone services and payphones) and emergency call services.
Telecommunications legislation also provides for the Commonwealth
to contract with the private sector for the provision of the
NRS.

The
legislative arrangements for the USO are set out in the
Telecommunications (Consumer Protection and Service Standards)
Act 1999 (the Consumer Protection Act) and legislative
instruments made under that Act. The USO requires Telstra as the
current primary universal service provider (PUSP) to ensure that
standard telephone services and payphones are reasonably accessible
to all people in Australia on an equitable basis, wherever they
reside or carry on business. Under this current legislation, the
telecommunications industry contributes funding towards the
delivery of the USO through levy arrangements.

The
Consumer Protection Act also sets out the policy objectives for the
NRS, which is a service that provides voice equivalent services for
people who are deaf or who have a hearing and/or speech impairment.
NRS services are delivered under contract with the Commonwealth.
Under current Commonwealth contract arrangements, the relay service
is delivered by Australian Communication Exchange Limited, and an
outreach service for the NRS is provided by WestWood Spice.
Industry funds the cost of the NRS contracts through levy
arrangements similar to the USO scheme.

The
arrangements for emergency call services in Australia are covered
by the Telecommunications Act 1997 (the Telecommunications
Act), the Consumer Protection Act and legislative instruments made
under those Acts. The telecommunications industry is required to
provide access to the emergency call service for standard telephone
services free of charge. Currently, the national providers of the
emergency call service are Telstra and the NRS provider. The NRS
element is funded through the NRS levy, but Telstra’s costs
are not funded through levy arrangements.

Need for
change

The USO
regulatory arrangements were designed for a market where there was
a vertically integrated operator of a national telecommunications
network. The rollout of the NBN will result in a fundamental change
to the structure of the Australian telecommunications market as
Telstra’s near ubiquitous national copper fixed line network
will be progressively decommissioned as NBN Co rolls out its
next-generation fibre network nationally.

The NBN
will be operated on a wholesale-only and equivalent basis. In an
environment where all retail service providers are able, via the
NBN, to offer high quality voice and high-speed broadband services
nationally, it is appropriate that the model for delivering
universal service and other public policy telecommunications
outcomes be reformed to facilitate the competitive supply of
universal service and other public policy telecommunications
outcomes. A regime that enables competitive supply arrangements
will be of benefit to consumers and industry as it promotes more
innovative, effective and efficient service delivery
arrangements.

In this
regard, the service delivery arrangements for the USO will
transition to a model that is similar to the current arrangements
for the provision of the NRS, in that the Government will contract
with service providers for the supply of these important
services.

Telstra’s
role as the emergency call person also reflects its historical
position as the vertically integrated owner of a national
telecommunications network. The Government’s intention is
that, while the supplier of the emergency call service will remain
subject to direct regulation, the service will be delivered through
contract with the Commonwealth and for the telecommunications
industry to contribute to the costs of the emergency call service
through levy arrangements. This will also enable the provision of
the emergency call service to be opened up through a competitive
process to alternative suppliers. While a competitive process will
place a very high priority on reliable and robust service
arrangements, it also provides a mechanism to ensure that the
telecommunications services that the community expects continue to
be delivered effectively and efficiently.

On 23 June
2011, following consultation with industry, the Government
announced that it had entered into an initial service agreement
with Telstra to ensure continuity of services during the transition
to the NBN. Together with the existing NRS contracts outlined
above, the Telstra agreement will ensure:

that all
Australians have reasonable access to a standard telephone service
(the USO for voice telephony services)

that
payphones are reasonably accessible to all Australians (the USO for
payphones)

the
ongoing delivery of the Emergency Call Service by Telstra (calls to
Triple Zero ‘000’ and ‘112’)

the
ongoing delivery of the National Relay Service

that
appropriate safety net arrangements are in place that will assist
the migration of voice-only customers to a NBN fibre service as
Telstra’s copper customer access network is progressively
decommissioned, and

technological
solutions will be developed as necessary to support continuity of
other public interest services (i.e. public alarm systems and
traffic lights).

As part of
the reforms, a new statutory agency, TUSMA, will be established to
manage the Telstra agreement and other public interest
telecommunications contracts and grants. The establishment of a
statutory agency dedicated to the implementation and effective
administration of telecommunications service agreements will
promote high quality and efficient contract and grant management to
maximise the benefit for consumers and manage risks appropriately,
within a transparent and accountable legislative
framework.

Structure
of the Bill

The key
elements in this Bill include:

· amendments
to the Consumer Protection Act to provide a framework which will
allow the Minister to make declarations to enable the removal of
the current regulated obligations on the PUSP to make the STS and
payphones reasonably accessible, and shift to a fully contractual
model for provision of universal service outcomes

· amendments
to the Consumer Protection Act, the Telecommunications
(Universal Service Levy) Act 1997 and the NRS Levy
Imposition Act 1998 such that the USO and NRS levies
(respectively) will cease to apply after 30 June 2012 with a new
Telecommunications Industry Levy Scheme to meet the residual costs
of TUSMA (provided for in Part 6 of the TUSMA Bill and the Industry
Levy Bill) to take effect

· amendments
to provide that TUSMA will be a prescribed agency for the purposes
of the Financial Management and Accountability Act 1997 (FMA
Act) from commencement, and

· a range of
minor and technical amendments to the Australian Communications
and Media Authority Act 2005, the Competition and Consumer
Act 2010, the Criminal Code Act 1995, the
Sea Installations Act 1987, and the Telecommunications Act
to recognise the establishment of the TUSMA under the TUSMA Bill;
to allow the ACMA to administer, enforce and report on the new levy
provisions set out in Part 6 of the TUSMA Bill; and to reflect
the shift in responsibility for the delivery of universal service
outcomes and other public interest services to
TUSMA .

Progressive
removal of regulated obligations to supply the STS and
payphones

There are
two parts of current USO regulation - the USO in relation to
standard telephone services (STS) and the USO in relation to
payphones (paragraphs 9(1)(a) and 9(1)(b) of the Consumer
Protection Act). There is capacity for a USO to apply to carriage
services that are prescribed in regulations but no regulations have
been made and it is proposed to repeal these provisions (see item
82). The repeal of the concept of ‘prescribed carriage
services’ is consequential to the inclusion of paragraph
11(f) of the TUSMA Bill, which enables new policy objectives for
TUSMA to be specified under regulations where these objectives
relate to the supply of carriage services. As TUSMA will have the
capacity to take on additional functions under paragraph 11(f) of
the TUSMA Bill, the concept of ‘prescribed carriage
services’ will no longer be needed.

The Bill
proposes amendments to the Consumer Protection Act to enable the
progressive removal from Telstra of the STS and payphones parts of
USO regulation (existing paragraphs 9(1)(a) and (b)), where
the Minister is satisfied that specified conditions have been met
(proposed sections 8J and 8K of the Act).

During the
period beginning 18 months after commencement of the amendments to
the Consumer Protection Act and ending 23 months after
commencement, the Minister would be required to determine whether
or not there are satisfactory alternative contractual arrangements
in place for STS (proposed subsection 8J(1)). The Minister would
also be required to separately determine whether or not there are
satisfactory alternative contractual arrangements in place for
payphones (proposed subsection 8K(1)). In each case, the making of
a positive declaration by the Minister would be a pre-condition to
removal of the relevant part of USO regulation from
Telstra.

In
relation to both STS and payphones, the Minister would not be able
to make a positive declaration unless the relevant part of the
Telstra agreement (i.e. STS or payphones) remains in force; and the
Minister is satisfied that that Telstra is likely to substantially
comply with the contract if this part of USO regulation is removed.
In deciding whether Telstra is likely to substantially comply with
the contract, the Minister will be able to have regard to a range
of non-exhaustive criteria, including Telstra’s record of
compliance with relevant contract and regulatory obligations
(proposed subsections 8J(6) and 8K(6)).

If the
Minister makes a positive declaration of the kind referred to above
in relation to the payphones part of the USO, this part of USO
regulation would no longer apply in any area of Australia (item
76).

If the
pre-conditions for removal of the STS part of USO regulation are
met (because the Minister has made a positive declaration of the
kind outlined above), the Bill provides for the progressive removal
of the STS part of the USO regulation as the NBN fibre network is
rolled out (new section 8H). In broad terms, the Minister would
then be able to make further declarations that have the effect of
removing the STS USO in:

(a) non-fibre
designated STS areas (i.e.
areas where the Minister is satisfied that an NBN corporation has
not installed and does not propose to install optical fibre -
these are the areas that will receive high speed broadband from NBN
Co through wireless and satellite technologies), and

(b) fibre
designated STS areas (i.e.
areas where a final Migration Plan is in force to provide for the
transition of services from Telstra’s copper network to the
NBN fibre network (section 577BB of the Telecommunications Act) and
where the Minister is satisfied an NBN corporation has installed or
is installing optical fibre in those areas).

The
Minister would be required to make at least one declaration in
relation to either fibre or non-fibre designated STS areas within
90 days of making a positive declaration in relation to the STS.
The Minister would also be required to consider whether to make
further declarations at six monthly intervals.

The
progressive removal of the STS USO (in proposed NBN fibre areas) as
the fibre is installed by NBN Co is intended to ensure that Telstra
benefits from removal of the STS part of USO regulation in fibre
areas as it implements structural separation in those areas by
migrating its customers from the Telstra copper network to the NBN
fibre network in accordance with a final Migration Plan.

If STS or
payphones USO regulation is removed, Telstra would remain subject
to the contractual obligations that are provided for in the
agreement with the Commonwealth to be administered by
TUSMA.

If the
Minister does not declare that satisfactory alternative contractual
arrangements are in place for the STS part of USO regulation, the
Minister would be required to make a declaration that has the
effect of deferring consideration of whether the STS part of USO
regulation should be removed for an additional period of 18 months
(proposed paragraph 8J(1)(d)). The same process applies for
the payphones part of USO regulation (proposed paragraph 8K(1)(d)).
The statutory criteria for determining whether a declaration should
be made by the end of the additional period of 18 months in
relation to STS or payphones parts of USO regulation would be the
same as for the initial decision by the Minister (proposed
subsections 8J(6) and 8K(6) respectively).

The Bill
enables up to two such deferral declarations to be made by the
Minister (proposed subsections 8J(3), 8J(5), 8K(3) and 8K(5)) in
relation to STS or payphones USO regulation. If a positive
declaration has not been made by the end of the second deferral
period in relation to STS or payphones USO regulation, this part of
USO regulation could not be removed without further legislative
amendment.

Other
consequential and transitional amendments

The Bill
also makes a range of other consequential changes to the
Telecommunications Act and Consumer Protection Act. Most of the
non-levy aspects of the USO regime established by Part 2 of the
Consumer Protection Act will continue to operate unchanged until
such time as any relevant declarations are made under proposed new
sections 8J and 8K of the Consumer Protection Act, which will set
in train the process to enable USO STS or payphone obligations to
be removed.

Amendments
to the Part 3 of the Consumer Protection Act - the National
Relay Service

Part 3 of
the Consumer Protection Act currently sets out provisions that
enable the Commonwealth to contract providers of the NRS, a service
that provides persons who are deaf or who have a hearing and/or
speech impairment with access to a standard telephone service on
terms, and in circumstances, that are comparable to those on which
other Australians have access to a standard telephone service. The
Bill amends the Consumer Protection Act to transition management of
existing contracts for the provision of the NRS to
TUSMA.

The Bill
amends Schedule 1 of the FMA Regulations to declare TUSMA as a
prescribed agency for the purposes of the FMA Act from
commencement. The inclusion of this item as part of the legislative
package (including the TUSMA Bill and the Industry Levy Bill)
assists by expediting the process of establishing TUSMA so that it
can take on management of existing contracts with Telstra and NRS
providers from 1 July 2012.

Information
sharing with TUSMA

Other
consequential amendments allow the ACMA and ACCC to share
information with TUSMA. Providing these bodies with the capacity to
share information on communications matters with TUSMA could assist
TUSMA to meet its monitoring and reporting obligations set out at
clause 29 of the TUSMA Bill. These consequential amendments also
reflect the corresponding scope for TUSMA to disclose relevant
information to the ACMA and the ACCC (clause 122 of the TUSMA
Bill).

Regulatory
Impact Statement

See the
explanatory memorandum for the TUSMA Bill for a regulatory impact
statement related to the package of legislation.

Financial Implications

See the
explanatory memorandum for the TUSMA Bill for financial
implications related to the package of legislation.

Clause 1
provides that the Bill, when enacted, may be cited as the
Telecommunications Legislation Amendment (Universal Service
Reform) Act 2011 .

Clause 2
- Commencement

Clause 2
provides for the commencement of the Bill.

Clauses 1
to 3 of the Bill, and any other provisions not covered elsewhere in
the table provided at subclause 2(1), commence on the day the
Bill receives Royal Assent.

Parts 1
and 3 of Schedule 1 to the Bill commence at the same time that
clause 3 of the TUSMA Bill commences. Clause 3 of the TUSMA
Bill commences on a single day to be fixed by proclamation. The
TUSMA Bill does not commence until Telstra is legally committed to
the structural separation of its copper network as that network is
progressively decommissioned in fibre network areas through a
structural separation undertaking that is in force.

Linking
the commencement of Parts 1 and 3 to the commencement of clause 3
of the TUSMA Bill is necessary to ensure that the proposed
amendments to the telecommunications and other legislation,
including arrangements to phase out the existing USO and NRS levies
come into force at the same time as the establishment of TUSMA and
the introduction of new industry levy arrangements in Part 6 of the
TUSMA Bill.

Part 2 of
Schedule 1 to the Bill commences the later of 1 July 2012 and the
day that clause 3 of the TUSMA Bill commences (however,
the provisions do not commence at all if clause 3 of the TUSMA Bill
does not commence). Part 2 of Schedule 1 contains amendments that
relate to the NRS. As TUSMA will be assuming responsibility for an
existing Government contract for provision of the NRS, this fixed
start date ensures that the transfer of management of the NRS
contract from the ACMA to TUSMA coincides with the commencement of
the financial year beginning 1 July 2012.

Clause 3
- Schedule(s)

Subclause 3(1)
provides that each Act, and each set of regulations, specified in a
Schedule to the Bill is amended or repealed as set out in that
Schedule and any other item in a Schedule to the Bill has effect
according to its terms.

Subclause 3(2)
provides that the amendment of any regulation under
subclause 3(1) does not prevent the regulation, as so amended,
from being amended or repealed by the Governor-General.

SCHEDULE 1
- AMENDMENTS

Part
1—Amendments commencing at the same time as section 3 of the
Telecommunications Universal Service Management Agency Act 2011
commences

Part 1 of
Schedule 1 to the Bill amends the ACMA Act, the CC Act, the
Telecommunications Act and the Consumer Protection Act. These
are consequential to new
arrangements for the delivery of universal service outcomes and
other public interest services under contracts or grants of
financial assistance, and to facilitate the establishment of TUSMA
and a smooth transition to new levy arrangements. It also makes
minor, consequential amendments to the Sea Installations Act
1987 and the FMA Regulations; the amendments to the latter will
provide for TUSM A to be a
prescribed agency for the purposes of the FMA Act from
commencement.

Australian
Communications and Media Authority Act 2005

Item 1
- Section 3 (at the end of paragraph (b) of the definition of
authorised disclosure information )

Item 1
inserts at the end of paragraph (b) of the definition of
‘authorised disclosure information’ proposed
subparagraph (vi) referring to Part 6 of the TUSMA Bill. This
means that information obtained by the ACMA as a result of the
exercise of its powers under Part 6 of the TUSMA Bill will be
‘authorised disclosure information’.

Part 6 of
the TUSMA Bill concerns the assessment, collection and recovery of
levy, and outlines the role of the ACMA in making eligible revenue
assessments for the purpose of assessing the levy imposed by the
Industry Levy Bill. The inclusion of the reference to Part 6 of the
TUSMA Bill in the definition of ‘authorised disclosure
information’ is a consequential amendment consistent with the
current reference in that definition to Part 2 of the Consumer
Protection Act which similarly concerns, amongst other things, the
assessment, collection and recovery of the USO levy.

Item 2
- After subparagraph 8(1)(j)(v)

Item 2
extends the ACMA’s telecommunications functions under section
8 of the ACMA Act to include such other functions as are conferred
on the ACMA by or under Part 6 of the TUSMA Bill. Part 6 of
the TUSMA Bill sets out the ACMA’s functions with respect to
the assessment, collection and recovery of the levy imposed by the
Industry Levy Bill.

The
inclusion of the reference to Part 6 of the TUSMA Bill in the
ACMA’s telecommunications functions under section 8 of the
ACMA Act is a consequential amendment consistent with the current
reference in that provision to the Consumer Protection Act which
similarly concerns, amongst other things, the assessment,
collection and recovery of the USO levy.

Item 3
- After paragraph 59D(1)(n)

Item 3
amends subsection 59D(1) by inserting proposed paragraph (na)
to include TUSMA in the list of bodies to whom an ACMA official may
disclose authorised disclosure information, provided that the Chair
of the ACMA authorises it in writing and is satisfied that the
information will enable or assist TUSMA to perform or exercise any
of its functions or powers. Item 1 above amends the definition of
‘authorised disclosure information’.

It is
anticipated that the ACMA will have information that will be of
relevance to TUSMA (in performing or exercising any of its
functions or powers) including information about compliance with
Ministerial determinations made under clause 15 of the Bill,
and with the levy provisions set out in Part 6 of the TUSMA
Bill.

There is
corresponding scope for TUSMA to disclose relevant information to
the ACMA and the ACCC (see clause 122 of the TUSMA
Bill).

Competition
and Consumer Act 2010

Item 4
- After paragraph 155AAA(12)(k)

Section 155AAA
of the CC Act prohibits ACCC members or staff from disclosing
protected information unless one of the exceptions set out in the
section applies. An exception includes if the Chairperson of the
ACCC is satisfied that particular protected information will enable
or assist one of the bodies listed in subsection 155AAA(12) to
perform or exercise any of its functions or powers, then the
information may be disclosed to that body. Subsection 155AAA(13)
enables the Chairperson to impose conditions to be complied with in
relation to the disclosure.

This item
includes reference to TUSMA on the list of bodies that the Chairperson
may authorise the disclosure of protected information to, if the
Chairperson is satisfied that it will enable or assist TUSMA in the
performance or exercise of any of its functions or powers. The
functions and powers of TUSMA are set out in the TUSMA
Bill. The policy objectives at clause 11 of the TUSMA Bill relate
primarily to the delivery of universal service outcomes, but also
to provision of other key public interest services in the
telecommunications sector.

A capacity
for the ACCC to share information on communications matters with
TUSMA may assist TUSMA in meeting its monitoring and reporting
obligations set out at clause 29 of the TUSMA
Bill.

There is corresponding scope for TUSMA to disclose relevant
information to the ACMA and the ACCC (see clause 122 of the TUSMA
Bill).

Financial
Management and Accountability Regulations 1997

Item 5
- Part 1 of Schedule 1 (after table item
180)

Section 5
of the FMA Act provides that for the purposes of that
Act , a
prescribed agency includes a body, organisation or group of persons
prescribed by the Financial Management and Accountability
Regulations 1997 (the FMA Regulations). Agencies are prescribed
in Schedule 1 to the FMA Regulations.

The
proposed amendment to Schedule 1 of the FMA
Regulations by item 5 means that TUSMA will be a prescribed agency
for the purposes of the FMA Act from
commencement. Item 5
clarifies that the reference to TUSMA in Schedule 1
includes:

· the Chief
Executive Officer of TUSMA (mentioned in clause 58 of the TUSMA
Bill)

· the staff
(mentioned in clause 71 of the TUSMA Bill)

· those
persons whose services are made available to TUSMA (under
clause 73 of the TUSMA Bill), and

· the
consultants engaged by TUSMA (under subclause 72(1) of the
TUSMA Bill).

The
inclusion of this item as part of the legislative package ensures
that the financial management and accountability obligations in the
FMA Act apply to TUSMA immediately from the time it is
established.

The FMA
Act sets out the financial management, accountability and audit
obligations of agencies that are financially part of the
Commonwealth. In particular, that Act requires agencies to manage
public resources efficiently, effectively, economically and
ethically. It also requires that proper accounts and records be
maintained for the receipt and expenditure of public money. This
item is consistent with clauses 33 and 34 of the TUSMA Bill, which
make clear TUSMA holds any money for and on behalf of the
Commonwealth, and that any financial liabilities of TUSMA are taken
to be liabilities of the Commonwealth.

Sea
Installations Act 1987

Item 6
- Schedule

This
item inserts a reference to the TUSMA Bill into the Schedule
of the Sea Installations Act 1987 in its appropriate
alphabetical position.

Section 45
of the Sea Installations Act 1987 provides that certain
Commonwealth Acts, as provided for in the Schedule to that Act, are
to apply in adjacent areas. ‘Adjacent areas’ is defined
in section 5 of that Act to include, in general, waters of the
sea that are outside the outer limits of Australia’s
territorial sea, but either within the outer limits of the
exclusive economic zone (within the meaning of the Seas and
Submerged Lands Act 1973 ), or outside those limits but within
the outer limits of the continental shelf. Both the
Telecommunications Act and the Consumer Protection Act (including
the USO provisions of that Act) are included in the
Schedule.

The
inclusion of the TUSMA Bill in the Schedule to the Sea
Installations Act 1987 would extend the application of the
TUSMA Bill, and the obligations set out in any contracts or grants
under that Bill, to sea installations within Australia’s
territorial sea, including, for example, submarine power cables,
floating hotels, tourism pontoons and artificial islands. This
approach is consistent with other telecommunications legislation
and takes into account the intended removal over time of the USO
provisions from the Consumer Protection Act.

Telecommunications
Act 1997

Item 7
- Paragraph 3(2)(a)

This
proposed amendment to paragraph 3(2)(a) clarifies that the other
objects of the Telecommunications Act with respect to the USO are
limited to standard telephone services and payphones, and do not
include other carriage services.

The change
is a consequence of the proposed repeal of section 9D of the
Consumer Protection Act, which enables a carriage service to be
specified in the regulations. The repeal of the concept of
‘prescribed carriage services’ is consequential to the
inclusion of paragraph 11(f) of the TUSMA Bill, which enables new
policy objectives for TUSMA to be specified under regulations where
these objectives relate to the supply of carriage services. As
TUSMA will have the capacity to take on additional functions under
that clause, the concept of ‘prescribed carriage
services’ will no longer be needed.

This
item inserts reference to Part 6 of the TUSMA Bill into the
definition of ‘ACMA’s telecommunications powers’
in section 7.

This
amendment would enable the ACMA to obtain information and documents
from other persons under section 522 of the Telecommunications
Act where the ACMA has reason to believe that the information is
relevant to the exercise of its telecommunications powers under
Part 6 of the TUSMA Bill.

The
inclusion of the reference to Part 6 of the TUSMA Bill (which
relates to the assessment, collection and recovery of the new
industry levy) into the definition of ‘ACMA’s
telecommunications powers’ is a consequential amendment
consistent with the current reference in that definition to the
Consumer Protection Act, which similarly concerns, amongst other
things, the assessment, collection and recovery of the USO
levy.

Item 9
- Section 7

Item 10
- Section 7 (definition of levy )

Item 9
inserts in section 7 a proposed new definition of
‘industry levy’ to mean the levy imposed by the
Industry Levy Bill. This levy will, from the commencement of the
TUSMA Bill, replace the USO and NRS levies currently imposed,
respectively, under the Telecommunications (Universal Service
Levy) Act 1997 and the NRS Levy Imposition
Act 1998 . The replacement of the USO and NRS levies by
this Bill (see items 95, 107, 111, 118 and 120) with a single levy
mechanism will assist with meeting the residual costs of TUSMA. The
USO and NRS levies will cease to apply after 30 June
2012.

To
distinguish the USO levy from the new industry levy in the
Telecommunications Act, item 10 will repeal the definition of
‘levy’ in section 7 and the USO levy will be redefined
to mean the “universal service levy” (see item 12
below).

Item 11
- Section 7

This
item inserts in section 7 a proposed definition of
‘TUSMA’ to mean “the Telecommunications Universal
Service Management Agency”. This will make clear which agency
is referred to by the ‘TUSMA’ acronym as contained in
the provisions proposed to be included in the Telecommunications
Act by this Bill.

Item 12
- Section 7

Item 12
inserts in section 7 a proposed definition of ‘universal
service levy’ to mean the levy imposed by the
Telecommunications (Universal Service Levy) Act 1997 . This
item is consequential to the amendments referred to in items 9 and
10.

Item 13
- At the end of section 19

This
item inserts a proposed subsection (3) at the end of
section 19 to provide that a person may be specified in
writing by the ACMA (for the purposes of paragraph 19(1)(b))
as either a national or regional operator of emergency call
services even if at the time the determination is made, that person
does not operate an emergency call service.

Section 19
provides that a recognised person who operates an emergency call
service is defined to be a person who:

· operates
an emergency call service; and

· is
specified in a written determination made by the ACMA as a national
or regional operator of emergency call services.

The
proposed new subsection 19(3) is intended to remove any doubt
that the ACMA can make a determination to appoint a person who has
the capacity to operate an emergency call service, even if they are
not operating an emergency call service at the time that a written
determination is made by the ACMA.

While
TUSMA may enter into contracts or grants in relation to the
fulfilment of the emergency call service policy objective at
paragraph 11(c) of the TUSMA Bill, due to the nature and importance
of the emergency call service, provisions for regulation of the
emergency call service will not be removed from the Consumer
Protection Act as a result of the establishment of
TUSMA.

Therefore
carriers, carriage service providers and emergency call persons
will remain regulated by the ACMA under section 147 of the Consumer
Protection Act. It is intended that the ACMA and TUSMA coordinate
their respective roles in relation to the emergency call service.
In particular, it is intended that the ACMA be able to determine a
new emergency call person when a suitable person has, or is about
to enter into a contract or grant with TUSMA in relation to the
fulfilment of the emergency call service policy objective at
paragraph 11(c) of the TUSMA Bill, and is ready to provide an
emergency call service.

Item 14
- Subsection 57(2) (definition of this
Act )

This item
amends subsection 57(2) such that a carrier licence has effect
subject to not only the Telecommunications Act and the Consumer
Protection Act and regulations under that Act, but also to Part 6
of the TUSMA Bill.

Section 1
of Schedule 1 to the Telecommunications Act makes it a
statutory condition of a licence that a carrier must comply with
the Telecommunications Act, the Consumer Protection Act, and it is
proposed to also include reference to Part 6 of the TUSMA Bill
in this Schedule (see item 52). Contravention of Part 6 of the
TUSMA Bill will subject a carrier to civil penalty provisions under
the Telecommunications Act (see the proposed amendment at item 40
to section 572E of the Telecommunications Act) involving pecuniary
penalties of up to $10 million.

This is a
consequential amendment arising from the replacement of the USO and
NRS levies in the Consumer Protection Act with the new industry
levy to be assessed under the TUSMA Bill and reflects that
carriers’ obligations regarding the new levy arrangements
will be located in Part 6 of the TUSMA Bill.

Item 15
- Paragraphs 58(2)(a) and (b)

This item
amends paragraphs 58(2)(a) and (b) and is a consequence of the
proposed new subsection 72(2A) (see item 22 of the Bill). This item
clarifies that the grounds under section 58 for refusal of a
carrier licence, due to the disqualification of the applicant,
extend to circumstances where, under the proposed new
subsection 72(2A), the ACMA cancels a carrier licence held by
a carrier because the carrier has failed to pay in full any
industry levy imposed by the Industry Levy Bill on or before the
date on which the industry levy becomes due and payable. The
amendment ensures that the requirements regarding the current
universal service levy and the new industry levy are treated
consistently under this section.

Item 16
- Paragraphs 58(4)(a), (b) and (c)

Item 17
- After subsection 58(4)

These
amendments are consequential changes arising from phasing out the
universal service levy assessed under the Consumer Protection Act
and moving to the new industry levy assessed under Part 6 of the
TUSMA Bill.

Subsection
58(1) enables the ACMA to refuse to grant a carrier licence to an
applicant if the applicant is disqualified immediately before the
ACMA makes its decisions on the application. Subsection 58(4) sets
out the circumstances for when an individual is disqualified for
failure to pay the universal service levy. The proposed amendments
to subsection 58(4) make clear that this subsection is to apply to
the universal service levy. The proposed new subsection 58(4A)
is intended to operate concurrently with subsection 58(4) and sets
out the circumstances for when an individual is disqualified for
failure to pay the new industry levy to be imposed by the Industry
Levy Bill.

These
amendments will enable the ACMA to refuse to grant a carrier
licence if at the appropriate point in time the individual has been
disqualified due to a failure to pay either the universal service
levy or the new industry levy.

Item 18
- Paragraph 58(5)(a)

This
item amends paragraph 58(5)(a) and is a consequence of
the proposed new subsection 72(2A) at item 22. This amendment
ensures that subsection 58(5) - which applies to when a
partnership is disqualified - will operate with respect to a
disqualification arising from either the failure to pay the
universal service levy imposed by the
Telecommunications (Universal Service Levy) Act 1997 or
the failure to pay the industry levy imposed by the Industry Levy
Bill.

Item 19
- Subsection 67(3) (definition of this
Act )

This item
extends the definition of ‘this Act’ in
subsection 67(3) to include reference to the TUSMA
Bill.

Carrier
licence conditions are subject to the conditions specified in
Schedule 1 of the Telecommunications Act; the conditions that a
carrier must comply with any standard access obligations that are
applicable under the CC Act; and any conditions declared by the
Minister. The effect of this amendment is that section 67 will
provide that a condition of a carrier licence may remove or
restrict a right or privilege that the carrier would otherwise have
under a provision of the TUSMA Bill, in addition to a provision of
the Telecommunications Act or the Consumer Protection Act (whether
or not in the carrier’s capacity as a carrier).

Item 20
- Subsection 72(2)

Item 21
- Subsection 72(2) (note)

Item 22
- After subsection 72(2)

Subsection
72(2) enables the ACMA to cancel a carrier licence held by a
carrier if the carrier fails to pay in full any levy on or before
the date the levy becomes payable and due. Items 20 to 22 are
consequential amendments arising from phasing out the universal
service levy assessed under the Consumer Protection Act and moving
to the new industry levy assessed under Part 6 of the TUSMA
Bill.

The
proposed amendments will enable the ACMA to cancel a carrier
licence if a carrier fails to pay in full either the universal
service levy imposed by the Telecommunications (Universal Service
Levy) Act 1997 or the new industry levy imposed by the Industry
Levy Bill by the due date. Similarly, items 16 and 17 also provide
the ACMA can refuse to grant a carrier licence for failure to pay
either levy.

Item 23
- Subsection 78(2) (definition of this
Act )

Item 23
extends the definition of ‘this Act' in subsection 78(2)
by including reference to the TUSMA Bill.

Division 4
of Part 3 of the Telecommunications Act enables licensed
carriers to apply to the ACMA to be declared a nominated carrier in
relation to specified network units owned by another person. Where
a nominated carrier declaration is in force, any obligation on the
owner of the network unit to be licensed as a carrier in regard to
that unit ceases.

The effect
of expanding the definition of ‘this Act’ to include
the TUSMA Bill is that subsection 78(1) will provide that an
application to the ACMA for a nominated carrier declaration is
required to be accompanied by, amongst other things, the election
of the applicant accepting responsibility for the units for the
purposes of the TUSMA Bill, in addition to the Telecommunications
Act and the Consumer Protection Act (and regulations under that
Act).

Item 24
- Subsection 81(5) (definition of this
Act )

Item 24
extends the definition of ‘this Act’ in
subsection 81(5) by including reference to the TUSMA
Bill.

This
amendment to section 81 will have the effect of providing that
the ACMA may, after considering an application for a nominated
carrier declaration, only declare that the applicant is the
nominated carrier in relation to the relevant network units if the
ACMA is satisfied that, among other things, the making of the
declaration would not impede the efficient administration of the
TUSMA Bill, in addition to the Telecommunications Act and the
Consumer Protection Act (and regulations under that
Act).

Item 25
- Subsection 81A(3) (definition of this
Act )

Item 25
extends the definition of ‘this Act’ in
subsection 81A(3) by including reference to the TUSMA
Bill.

This
amendment will ensure that, if at any time the nominated carrier
does not own or operate the network units covered by the relevant
declaration, the TUSMA Bill (in addition to the Telecommunications
Act and the Consumer Protection Act (and regulations under that
Act)) will nevertheless apply to the nominated carrier in relation
to the network as if they were owned or operated by the network
carrier.

Item 26
- Subsection 83(8) (definition of this
Act )

This
item extends the definition of ‘this Act’ in
subsection 83(8) by including reference to the TUSMA
Bill.

Section 83
deals with the revocation of nominated carrier declarations. The
effect of this amendment would be that if a nominated carrier gives
the ACMA a written notice stating that it does not accept
responsibility for the units for the purposes of the TUSMA Bill (or
the Telecommunications Act or Consumer Protection Act (or
regulations under that Act)), then the ACMA must, by writing,
revoke that carrier’s nominated carrier
declaration.

Item 27
- Paragraph 105(3)(e)

Item 28
- After paragraph 105(3)(ea)

Subsection
105(1) requires the ACMA to monitor and report each financial year
to the Minister on all significant matters relating to the
performance of carriers and carriage service providers.

Item 27
amends paragraph 105(3)(e) of the Telecommunications Act by
providing that the ACMA’s subsection 105(1) report must
set out details of the adequacy of compliance with obligations
under Part 2 of the Consumer Protection Act only if there are
any such obligations. This amendment reflects the proposed gradual
phasing out of the universal service regime in Part 2 of the
Consumer Protection Act. As the ACMA’s obligations under that
Part will be gradually phased out and transferred to TUSMA, the
ACMA will eventually have no reporting obligations under this
paragraph.

Item 28
inserts two new paragraphs 105(3)(eb) and (ec). These will
provide, respectively, that the ACMA’s subsection 105(1)
report must set out details of:

· the
adequacy of compliance with obligations under Part 6 of the
TUSMA Bill; and

· the
operation of Part 6 of the TUSMA Bill.

These
amendments ensure that the ACMA’s report extends to cover
matters arising in relation to assessment, collection and recovery
of the new industry levy under Part 6 of the TUSMA
Bill.

This
item extends the definition of ‘this Act’ in
subsection 492(5) to include Part 6 of the TUSMA
Bill.

Section 492
provides that, as a general rule, a hearing by the ACMA for the
purposes of a public inquiry about certain matters relating to
telecommunications will be required to be held in public. A hearing
or part of a hearing will, however, be able to be conducted in
private if the ACMA is satisfied that a public hearing would not be
conducive to the due administration of ‘this Act’. If a
hearing is held in public, the ACMA will be required to give
reasonable public notice of the conduct of the hearing.

This
amendment will enable the ACMA, in determining if a hearing should
be held in public, to have regard to the due administration of the
levy assessment, collection and recovery provisions in Part 6 of
the TUSMA Bill. The amendment ensures that the current universal
service levy (under the Consumer Protection Act) and the new
industry levy (under Part 6 of the TUSMA Bill) are treated
consistently under this section.

This
item extends the definition of ‘this Act’ in
subsection 502(5) to include Part 6 of the TUSMA
Bill.

Division 3
of Part 25 enables the ACCC to hold public inquiries about
certain matters relating to telecommunications. Section 502
provides that, as a general rule, hearings will be required to be
held in public and if the hearing is to be conducted in public, the
ACCC will be required to give reasonable public notice of the
conduct of the hearing.

Subsection
502(3) enables a hearing, or part of a hearing, to be conducted in
private if the ACCC is satisfied that confidential evidence may be
given or other confidential matters may arise during the hearing,
or that hearing a matter, or part of a matter, in public would not
be conducive to the due administration of ‘this
Act’.

Similar to
the amendment to subsection 492(5) at item 29 above, this
amendment will enable the ACCC, in determining if a hearing should
be held in public, to have regard to the due administration of the
levy assessment, collection and recovery provisions in Part 6
of the TUSMA Bill. The amendment ensures that the current universal
service levy (under the Consumer Protection Act) and the new
industry levy (under Part 6 of the TUSMA Bill) are treated
consistently under this section.

Item 31
- After paragraph 508(aa)

Part 26
of the Telecommunications Act provides the ACMA with the power to
investigate certain matters relating to telecommunications.
Item 31 inserts a proposed new paragraph 508(aaa) to
extend the matters to which Part 26 applies to include a
contravention of Part 6 of the TUSMA Bill.

Under
Part 6 of the TUSMA Bill, the ACMA will have the power to
assess, collect and recover the industry levy to be imposed by the
Industry Levy Bill. The amendment to section 508 will enable
the ACMA to investigate matters relating to a contravention of Part
6 of the TUSMA Bill.

This power
to investigate complements the extension of other ACMA powers in
relation to Part 6 of the TUSMA Bill, including the power to cancel
carrier licences (item 22) or seek injunctions by the Federal Court
(item 37).

Item 32
- After paragraph 510(1)(aa)

Item 32
inserts a new paragraph 510(1)(aaa). This amendment makes
clear that the ACMA may investigate a contravention of Part 6 of
the TUSMA Bill if the ACMA has reason to suspect that a person may
have contravened that Part. This amendment is consequential to the
amendment in item 31.

Item 33
- At the end of section 512

Item 34
- At the end of section 513

Item 33
inserts a proposed new subsection 512(7), which will require
the ACMA, before investigating a contravention of Part 6 of the
TUSMA Bill, to inform TUSMA that the matter is to be investigated.
This amendment is consequential to items 31 and 32
above.

It is
appropriate that the ACMA notify TUSMA before it begins an
investigation since a contravention of Part 6 of the TUSMA
Bill may have implications for TUSMA in terms of the performance of
its functions and the exercise of its powers. For example, the ACMA
investigating the failure of a carrier to lodge an eligible revenue
return may impact levy contribution calculations and possibly delay
levy payments, which could affect the ability of TUSMA to make
payments to contractors or grant recipients. C lause 13
of the TUSMA Bill enables TUSMA to enter into contracts (and/or
grants) to achieve the policy objectives at clause 11 of that
Bill.

Item 34
inserts a proposed new subsection 513(3), which will require
the ACMA, if it decides not to investigate, or not to investigate
further, a complaint in relation to a possible contravention of
Part 6 of the TUSMA Bill, to inform TUSMA of the decision as soon
as practicable. Since item 33 requires the ACMA to notify TUSMA
prior to beginning an investigation of a contravention of
Part 6 of the TUSMA Bill, it is appropriate that TUSMA also be
notified of any decision by the ACMA not to proceed with an
investigation.

Item 35
- Subsection 551(3) (definition of this
Act )

This item
extends the definition of ‘this Act’ in
subsection 551(3) by including reference to Part 6 of the
TUSMA Bill.

Section 551
allows a court to order the forfeiture to the Commonwealth of
anything involved in the commission of an offence for which a
person has a person has been convicted. The expansion of the
meaning of ‘this Act’ to include Part 6 of the
TUSMA Bill would enable a court to order forfeiture to the
Commonwealth arising from the offence under clause 120 of the
TUSMA Bill of failing to lodge an eligible revenue return. This
approach is consistent with existing legislation in that equivalent
provisions in Part 2 of the Consumer Protection Act also apply
to section 551.

Item 36
- Section 563

This
item amends the simplified outline in section 563 of
Part 30 of the Telecommunications Act to provide that the
Federal Court may grant injunctions in relation to the
contravention of:

· the
Telecommunications Act;

· the
Consumer Protection Act (and any regulations under that Act);
or

· Part 6
of the TUSMA Bill.

This item
is consequential to item 37 below.

Item 37
- Subsection 564(4) (definition of this
Act )

Item 37
is related to item 38, and extends the definition of ‘this
Act’ in subsection 564(4) to include reference to
Part 6 of the TUSMA Bill. This amendment will enable the
Federal Court to grant an injunction in relation to a contravention
of Part 6 of the TUSMA Bill. This amendment is consistent with the
Court’s existing powers to grant injunctions in relation to
contraventions of the Consumer Protection Act and the
Telecommunications Act.

It is
appropriate that injunctions be permissible in relation to
contraventions of Part 6 of the TUSMA Bill, as such contraventions
may have implications for TUSMA in terms of the performance of its
functions and the exercise of its powers. For example, failure of a
carrier to lodge an eligible revenue return may impact levy
contribution calculations and possibly delay levy payments, which
subsequently may affect the ability of TUSMA to make payments to
contractors or grant recipients.

Item 38
- Subsection 570(7) (definition of this
Act )

This item
extends the definition of ‘this Act’ in
subsection 570(7) by including reference to Part 6 of the
TUSMA Bill.

Section 570
enables a court to order a person to pay a pecuniary penalty to the
Commonwealth if satisfied the person has contravened a civil
penalty provision. Contravention of Part 6 of the TUSMA Bill (and
the Telecommunications Act and Consumer Protection Act as section
570 currently applies to) will subject a person to civil penalty
provisions involving pecuniary penalties of up to $10 million (by
virtue of proposed amendments to section 572E of the
Telecommunications Act as per item 40 below). The expansion of the
meaning of ‘this Act’ under section 570 to include
Part 6 of the TUSMA Bill is consistent with existing
legislation and would enable a court to order payment of pecuniary
penalties for a contravention of that Part.

Item 39
extends the definition of ‘this Act’ in
subsection 572B(6) to include reference to Part 6 of the
TUSMA Bill.

This
amendment enables the ACMA to accept written undertakings from a
person to ensure compliance with, or prevent contravention of,
Part 6 of the TUSMA Bill. For example, this could allow the
ACMA to accept an undertaking from a person that they will lodge an
eligible revenue return under clause 91 of the TUSMA Bill within
say, 48 hours, instead of immediately instituting proceedings
against the person.

If a
person breaches an undertaking then the ACMA may apply to the
Federal Court for an order. If the Court is satisfied that a person
has breached a term of the undertaking then it may direct the
person to comply with the term of the undertaking, or make any
other order that the Court considers appropriate (subsection
572C(2)).

This item
extends the definition of ‘this Act’ in
subsection 572E(9) by including reference to Part 6 of the
TUSMA Bill.

Section
572E enables an ‘authorised infringement officer’ to
issue an infringement notice if the officer has reasonable grounds
to believe that a person has contravened a particular civil penalty
provision. However, if the civil penalty provision arises from
either a breach of section 68 or section 101 of the
Telecommunications Act (as will be the case with Part 6 of the
TUSMA Bill as a consequence of items 52 and 53), an infringement
notice may only be issued if the civil penalty provision has been
declared by the ACMA to be a ‘listed infringement notice
provision’. This amendment enables the ACMA to declare Part 6
of the TUSMA Bill to be such a provision since it is to be included
in the definition of ‘this Act’.

Item 41
extends the definition of ‘this Act’ in section 574A to
include reference to Part 6 of the TUSMA Bill for the purposes of
Part 32 of the Telecommunications Act. Part 32 deals with
the proof of matters that involve directors, employees and agents
of corporations in connection with civil and criminal
proceedings.

This
proposed amendment has the effect that, in the context of the TUSMA
Bill, if a
director, employee or agent of a corporation engages in conduct on
behalf of the corporation within the scope of his or her authority,
the conduct will be taken, for the purposes of a proceeding for an
offence under Part 6 of the TUSMA Bill to have been engaged in
by the corporation unless the corporation establishes that it took
reasonable precautions and exercised due diligence to avoid the
conduct (subsection 575(2)). As proposed, the only offence in
Part 6 relates to the failure to lodge an eligible revenue
return under clause 120 of the TUSMA Bill.

If conduct
is engaged in on behalf of a person other than a corporation by an
employee or agent of the person and the conduct is within the scope
of his or her authority, the conduct will be taken, for the
purposes of a proceeding under Part 6 of the TUSMA Bill to
have been engaged in by the person unless the person establishes
that he or she took reasonable precautions and exercised due
diligence to avoid the conduct (subsection 576(3)).

Item 42
- Section 582

This
item amends the simplified outline for Part 35 of the
Telecommunications Act by including, in dot point 2, a reference to
the TUSMA Bill, which deals with assessment, collection and
recovery of levy. This amendment clarifies in the simplified
outline that partnerships are to be treated as persons for the
purposes of the TUSMA Bill.

This
amendment is consequential to item 46 below.

Item 43
- Section 582

This
item amends the simplified outline for Part 35 of the
Telecommunications Act by including, in dot point 4, a reference to
the TUSMA Bill. This amendment clarifies in the simplified outline
that instruments made under the TUSMA Bill may apply, adopt or
incorporate certain other instruments.

This
amendment is consequential to item 50 below.

Item 44
- Section 582

Item 44
amends the simplified outline for Part 35 of the
Telecommunications Act by including, in dot point 7, a reference to
the TUSMA Bill. This amendment clarifies in the simplified outline
that the TUSMA Bill does not affect the performance of State or
Territory functions.

This
amendment is consequential to item 51 below.

Item 45
- Subsection 583(3) (definition of this
Act )

This item
extends the definition of ‘this Act’ in
subsection 583(3) to include reference to Part 6 of the
TUSMA Bill.

The effect
of this amendment is that if an offence against Part 6 of the
TUSMA Bill is a continuing offence (whether under the TUSMA Bill or
because of section 4K of the Crimes Act 1914 ), the
maximum penalty for each day that the offence continues is
10 per cent of the maximum penalty that could be imposed
in respect of the principal offence.

As
proposed, the only offence in Part 6 relates to the failure to
lodge an eligible revenue return under clause 120 of the TUSMA
Bill. In the
context of this clause, a continuing offence would be the
continuing failure to lodge an eligible revenue return as required
under clause 91 of that Bill within the time specified in the
instrument made under subclause 91(5).

Item 46
extends the definition of ‘this Act’ in
subsection 585(2) to include reference to the TUSMA Bill.
Section 585 provides for the manner in which partnerships are to be
treated for the purposes of the Acts defined in subsection
585(2).

Item 47
extends the definition of ‘this Act’ in subsection
586(2) to include reference to the TUSMA Bill. Section 586 provides
for the giving of documents to partnerships. In effect, if a
document is delivered personally to the partner of a partnership or
is left, or posted, to the partner’s last known residential
or business address, the document is taken to have been given to
the partnership.

This
item extends the definition of ‘this Act’ in
subsection 587(4) to include reference to Part 6 of the TUSMA
Bill. Section 587 makes provision for nominating an address for
service of documents. For example, this will enable a participating
person to nominate to the ACMA a relevant address where the person
can receive service of documents, including written documents
associated with the industry levy.

Item 49
- Subsection 588(4) (definition of this
Act )

Item 49
extends the definition of ‘this Act’ in
subsection 588(4) to include reference to Part 6 of the
TUSMA Bill. Section 588 applies to the service of summons or
process on foreign corporations in criminal proceedings.

Item 50
extends the
definition of ‘this Act’ in subsection 589(6)
to include reference to the TUSMA
Bill.

The effect
of this amendment is that, notwithstanding anything in the AIA or
the LI Act, regulations or any other instrument made under the
TUSMA Bill will be able to make provision in relation to a matter
by applying, adopting, or incorporating (with or without
modifications) provisions of any Commonwealth Act or of any
regulations or rules under a Commonwealth Act as in force at a
particular time or as in force from time to time (subsections
589(1), (5) and (6)).

In
addition, regulations or any other instrument made under the Act
will be able to make provision in relation to a matter by applying,
adopting or incorporating (with or without modifications) a matter
contained in any other instrument or writing whatever as in force
or existing at a particular time or from time to time even if the
other instrument or writing does not yet exist when the instrument
under the TUSMA Bill is made (subsections 589(2), (5)
and (6)).

A
reference in subsection 589(2) to ‘any other instrument or
writing’ is defined widely to include a reference to an
instrument or writing made by any person or body in Australia or
elsewhere (including, for example, the Commonwealth, a State or
Territory or one of its officers or authorities or an overseas
entity) whatever its nature and whether or not it has legal force
or effect. Examples will include:

· regulations
or rules under a Commonwealth Act

· a State
Act, a Territory law or regulations or any other instrument made
under such an Act or law

· an
international technical standard or performance indicator,
or

· a written
agreement such as a contract or an arrangement or an instrument or
writing made unilaterally (subsection 589(3)).

Nothing in
section 589 limits the generality of anything else in it
(subsection 589(4)).

The power
conferred by section 589 is essential for the making of
delegated legislation under the TUSMA Bill, especially with regard
to instruments necessary to effect an efficient transition from the
universal service regime to the alternative contractual/grant
arrangements under the TUSMA Bill. For instance:

· the power
for the Minister under clause 15 of the TUSMA Bill to
determine performance standards, performance benchmarks and other
rules or standards may need to refer to other Commonwealth
legislation, regulations, instruments or rules. For example, this
could provide that a Ministerial determination to establish a
minimum benchmark (made under clause 15 of the TUSMA Bill) that
commences upon the making of a declaration that there are
satisfactory alternative contractual arrangements relating to
standard telephone services or payphones (under proposed
sections 8J or 8K of the Consumer Protection Act
(item 71)), or

· a
determination under subparagraph 92(1)(b)(i) of the TUSMA Bill
may need to refer to the making of an eligible revenue assessment
under clause 96 of that Bill in determining when a person is
or is not a participating person for the purposes of that
instrument.

In both of
the examples above, the relevant instrument referred to may not
have been in existence at the time the determinations are made, but
it would nevertheless be necessary to refer to the making of that
instrument under Commonwealth legislation.

This
item extends the definition
of ‘this Act’ in subsection 592(2)
to include reference to the TUSMA
Bill. Section 592 provides that a power conferred by this Act
must not be exercised in such a way as to prevent the exercise of
the powers, or the performance of the functions, of government of a
State, the Northern Territory, the Australian Capital Territory or
Norfolk Island.

Item 52
- Subclause 1(2) of Schedule 1 (definition of
this Act )

This item
extends the definition of ‘this Act’ in
subclause 1(2) of Schedule 1 to the Telecommunications
Act to include reference to Part 6 of the TUSMA Bill.

This
amendment makes the requirement to comply with Part 6 of the
TUSMA Bill (concerning the assessment, collection and recovery of
the industry levy) a standard
carrier licence condition. As a consequence, non-compliance with
Part 6 of the TUSMA Bill will be a civil penalty, as section 68 of
the Telecommunications Act provides, in effect, that contravention
of a carrier licence is a civil penalty.

See also
item 22 which enables
the ACMA to cancel a carrier licence if a carrier fails to pay in
full the new industry levy imposed by the Industry Levy Bill by the
due date.

Carriers
are participating persons for the new industry levy by virtue of
paragraph 92(1)(a) of the TUSMA Bill.

Item 53
- Subclause 1(2) of Schedule 2 (definition of
this Act )

This item
extends the
definition of ‘this Act’ in subclause 1(2) of
Schedule 2 to the Telecommunications Act to include reference
to Part 6 of the TUSMA Bill.

The effect
of this amendment is to make compliance with Part 6 of the
TUSMA Bill (concerning the assessment, collection and recovery of
the industry levy) a standard service provider rule. Paragraph
92(1)(a) of the TUSMA Bill provides that carriers are participating
persons for the new industry levy. This means that carriers (unless
they are exempt) must lodge eligible revenue returns and may be
required to pay a levy. The Minister may also determine by written
instrument that carriage service providers are also participating
persons (subparagraph 92(1)(b)(i) of the TUSMA Bill). In the
absence of such a determination, the amendment in item 53 will have
no practical consequence, since without the determination the
Part 6 provisions will not apply to service providers that are
not carriers.

Item 54
- Paragraph 27(5)(e) of Schedule 3

A facility
installation permit is a written instrument issued by the ACMA to a
licensed carrier, providing authorisation for that carrier to
proceed with installation of one or more specified
telecommunications facilities in circumstances where the carrier
has not obtained all the administrative authority and proprietor
approvals required under state and territory
legislation.

Clause 27
sets out the matters that the ACMA must be satisfied about before
it may issue a facility installation permit under clause 25 of
Schedule 3 to the Telecommunications Act. It also sets out the
things that the ACMA is required to take into account in deciding
whether the grounds for an installation permit have been made out,
including, at paragraph 27(1)(d), the condition that the
advantages that are likely to be derived from the operation of the
facilities in the context of the telecommunications network to
which the facilities relate outweigh any form of degradation of the
environment that is likely to result from the installation of the
facilities.

In
determining whether the condition at paragraph 27(1)(d) has
been satisfied, paragraph 27(5)(e) currently provides that the
ACMA must have regard to whether the installation of the facilities
contributes to the fulfilment by the applicant of the universal
service obligation. Item 54 inserts a proposed new
paragraph 27(5)(e) which will in addition require that the
ACMA must have regard to whether the installation of the facilities
contributes to the applicant’s compliance with the
obligations under a contract or grant (whichever is applicable)
entered into or made under clause 13 of the TUSMA Bill for a
purpose relation to the USO policy objectives for STS and payphones
set out in paragraphs 11(a) and (b) of that Bill.

This item
is a consequential amendment arising from the gradual phasing out
and replacement of the universal service regime with the
alternative contractual arrangements under the TUSMA Bill (see
proposed new sections 8H-8K of the Consumer Protection Act
for the progressive removal of regulation under the universal
service regime).

Item 55
- After paragraph 1(jb) of
Schedule 4

Clause 1
of Schedule 4 sets out the kinds of decisions that may be subject
to reconsideration by the ACMA. Currently the list includes a
decision by the ACMA to remit the whole or part of a penalty a
person is liable to pay for late payment of the universal service
levy (ja) as well as the NRS levy (jb). Item 55 amends the
list to include a decision of the ACMA under subclause 121(3)
of the TUSMA Bill to remit the whole or part of a late payment
penalty that a person is liable to pay in respect of a levy amount
that remains unpaid.

This item
removes the reference to prescribed carriage services in the
simplified outline for the Act in section 4. This amendment is a
consequence of the proposed repeal of paragraph 9(1)(c) and
section 9D of the Consumer Protection Act which will result in
prescribed carriage services no longer being referred to in Part 2
of the Consumer Protection Act.

The repeal
of the concept of ‘prescribed carriage services’ is
consequential to the inclusion of paragraph 11(f) of the TUSMA
Bill, which enables new policy objectives for TUSMA to be specified
under regulations where these objectives relate to the supply of
carriage services. As TUSMA will have the capacity to take on
additional functions under that clause, the concept of
‘prescribed carriage services’ will no longer be
needed.

Item 57
- Section 4

Item 57
amends the simplified outline in section 4 by inserting,
before dot point 2, a proposed new dot point to explain to the
reader that the universal service regime established by the
Consumer Protection Act will be phased out and replaced by
alternative contractual arrangements under the TUSMA Bill. The
regulatory obligations with respect to the universal service regime
will be removed in accordance with the proposed amendments to Part
2 of the Consumer Protection Act (see
proposed new sections 8H, 8J and 8K of the Consumer Protection Act
for the progressive removal of regulation under the universal
service regime).

Item 58
- Subsection 5(2)

This item
inserts in subsection 5(2) a proposed definition of
‘designated STS area’ which is taken to have the
meaning given by proposed section 8H. The term ‘designated
STS area’ is intended to collectively refer to both a
non-fibre designated STS area and a fibre designated
area.

Part 2 of
the Consumer Protection Act provides for a universal service regime
that imposes on Telstra, as the PUSP, a series of regulated
obligations in relation to making the STS and payphones reasonably
accessible across Australia. However,
from the establishment of TUSMA, TUSMA will enter into, and
administer, contracts or grants for universal service outcomes and
other public interest services to achieve policy objectives at
clause 11 of the TUSMA Bill. Accordingly, t his Bill
proposes amendments (including a framework set out at proposed
sections 8H, 8J and 8K) to allow for a full transition, over time,
from the current regulated obligation for the supply of the STS and
payphones, to a solely contractual framework as set out in the
TUSMA Bill.

Item 59
- Subsection 5(2)

Item 59
inserts in subsection 5(2) a proposed new definition of
‘NBN Co’. This term is defined to have the same meaning
as in the National Broadband Network Companies
Act 2011 .

‘NBN
Co’ is defined in section 5 of the National Broadband
Network Companies Act 2011 to mean the company currently
registered as NBN Co Limited (ACN 136 533 741), as that company
exists from time to time (even if its name is changed at a later
date).

Unlike the
term ‘NBN corporation’, which appears in other
NBN-related legislation, the term ‘NBN Co’ is not
intended to include NBN Tasmania (currently registered as NBN
Tasmania Limited (ACN 138 338 271)) or another company over which
NBN Co is in a position to control. A reference to ‘NBN
Co’ in the Consumer Protection Act will therefore be a
reference to NBN Co Limited only. Before making a declaration of a
non-fibre designated STS area or a fibre designated STS area under
proposed section 8H, the Minister must consult NBN Co.

Item 60
- Subsection 5(2)

Item 61
- Subsection 5(2)

Items 60
and 61 insert in subsection 5(2) proposed definitions for
‘universal service contractor’ and ‘universal
service grant recipient’. A ‘universal service
contractor’ is defined to mean a person who is a contractor
within the meaning of the TUSMA Bill. Under that Bill, a person is
a contractor if TUSMA enters into a contract with the person for a
purpose relating to the achievement of any or all of the policy
objectives in clause 11 of that Bill.

A
‘universal service grant recipient’ is defined to mean
a person who is a grant recipient within the meaning of the TUSMA
Bill. Under that Bill, a person is a grant recipient if the person
receives a grant of financial assistance from TUSMA for a purpose
relating to the achievement of any or all of the policy objectives
in clause 11 of the Bill.

Proposed
sections 8H, 8J and 8K allow for a full transition, over time, from
the current regulated obligations for the supply of the STS and
payphones under Part 2 of the Consumer Protection Act, to a
solely contractual framework as set out in the TUSMA Bill. There
will be a transitional period whereby Telstra will have both
regulated obligations and contractual arrangements with TUSMA for
provision of the STS and payphones. Accordingly, these definitions
of ‘universal service contractor’ and ‘universal
service grant recipient’ are used in a number of items in
this Bill to distinguish where a service is being provided under
contract or grant arrangements with TUSMA.

Item 62
- Paragraph 6(4)(a)

Section 6
of the Consumer Protection Act defines the STS. This item amends
paragraph 6(4)(a) to extend the matters to which the Minister
may have regard under that paragraph to include infrastructure
being used by ‘universal service contractors’ and
‘universal service grant recipients’ in addition to the
infrastructure being used by universal service providers regulated
under Part 2 of the Consumer Protection Act. This amendment is
a consequence of the intended gradual transition from the universal
service regime established by the Consumer Protection Act to the
contractual framework for the delivery of similar outcomes under
the TUSMA Bill.

Item 63
- Subsection 6(6) (definition of this
Act )

This item
extends the definition of ‘this Act’ in
subsection 6(6) to include the TUSMA Bill. This ensures that
the definition of a STS (as provided for in section 6) is applied
consistently as between the Consumer Protection Act, the
Telecommunications Act and the TUSMA Bill.

Item 64
- Section 8

Item 64
amends the simplified outline in section 8 to clarify that the
universal service regime established by Part 2 of the Consumer
Protection Act is intended to be phased out and replaced by
alternative contractual arrangements under the TUSMA
Bill.

The
inclusion of this statement makes clear that there will be a
gradual transition from regulated universal service obligations
under Part 2 of the Consumer Protection Act to the contractual
framework established by the TUSMA Bill (see
proposed new sections 8H-8K of the Consumer Protection Act
for the progressive removal of regulation under the universal
service regime).

Item 65
- Section 8

Item 65
removes the reference to prescribed carriage services in the
simplified outline in section 8. This consequential amendment is a
result of the proposed repeal of section 9D of the Consumer
Protection Act, which currently enables carriage services to be
specified in the regulations.

The repeal
of the concept of ‘prescribed carriage services’ is
consequential to the inclusion of paragraph 11(f) of the TUSMA
Bill, which enables new policy objectives for TUSMA to be specified
under regulations where these objectives relate to the supply of
carriage services. As TUSMA will have the capacity to take on
additional functions under that clause, the concept of
‘prescribed carriage services’ will no longer be
needed.

Item 66
- Section 8A

This item
amends section 8A, which sets out the objects for Part 2
of the Consumer Protection Act, by requiring the objects to be read
together with the TUSMA Bill.

This
amendment is a consequence of the gradual transition from regulated
universal service obligations under Part 2 of the Consumer
Protection Act to the contractual framework as provided for under
the TUSMA Bill (see
proposed new sections 8H-8K of the Consumer Protection Act
for the progressive removal of regulation under the universal
service regime).

Item 67
- Subparagraph 8A(a)(ii)

Item 68
- Subparagraph 8A(a)(iii)

These
items amend section 8A to repeal “prescribed carriage
services” as an object of the Consumer Protection
Act.

These are
consequential amendments following the proposed repeal of
section 9D of the Consumer Protection Act, which currently
enables the making of prescribed carriage services by
regulations. The
repeal of the concept of ‘prescribed carriage services’
is consequential to the inclusion of paragraph 11(f) of the TUSMA
Bill, which enables new policy objectives for TUSMA to be specified
under regulations where these objectives relate to the supply of
carriage services. As TUSMA will have the capacity to take on
additional functions under that clause, the concept of
‘prescribed carriage services’ will no longer be
needed.

Item 69
- Paragraph 8D(1)(a)

Item 70
- After subsection 8D(3)

Item 69
amends paragraph 8D(1)(a) with the effect that the final claim
period to apply under the Consumer Protection Act will be the
financial year 2011-12.

From 1 July
2012, the universal service levy to which the claim period relates
will be replaced by an industry levy to be imposed by the Industry
Levy Bill. Item 70 is a consequential amendment arising from the
amendment to paragraph 8D(1)(a).

Item 71
- At the end of Division 1 of Part 2

Item 71
inserts three proposed new sections providing the Minister with the
power to designate STS areas and make declarations about
alternative contractual arrangements relating to the standard
telephone service and payphones. The proposed sections provide
mechanisms for the transition from the application of regulatory
USO provisions under Part 2 of the Consumer Protection Act to
the contractual framework set out under the TUSMA Bill.

Proposed
sections 8H and 8J operate together to provide processes for the
progressive removal of Telstra’s regulatory obligation to
supply the standard telephone service. Proposed section 8K sets out
the process for the removal of Telstra’s regulatory
obligation for the provision of payphones.

There will
be a transitional period whereby Telstra will have regulated
obligations to supply the STS and payphones under Part 2 of the
Consumer Protection Act, and, at the same time, be required to
provide these services under the contractual framework provided for
under the TUSMA Bill. After the USO regulation for the standard
telephone service and/or payphones is lifted, pursuant to the
declarations made under these proposed new sections (and
consequential amendments made elsewhere to the Consumer Protection
Act), the contractual arrangements set out in the TUSMA Bill will
then provide for the continued delivery of universal service
outcomes.

Proposed
section 8J sets out the process by which the Minister is
required to make declarations as to whether there are satisfactory
alternative contractual arrangements relating to standard telephone
services. This proposed section obliges the Minister to determine
whether or not Telstra has fulfilled specified pre-conditions, the
consequential effect of which will be the removal of the USO STS
regulation under the Consumer Protection Act.

Once a
declaration of satisfactory alternative contractual arrangements
has been made under proposed section 8J, declarations can be made
under proposed section 8H to identify those areas in Australia
where USO regulation is to be lifted. The two sections will
therefore work in concert with item 72 to progressively remove the
regulatory obligations relating to Telstra’s provision of STS
in Australia.

Proposed
subsection 8J(1) requires the Minister, after 18 months (but
no later than 23 months) from commencement of the section, to make
either of the following initial declarations:

· a
declaration that, in the Minister’s opinion, there are
satisfactory alternative contractual arrangements in relation to
standard telephone services, or

· a
declaration that the 18 month period starting immediately after the
declaration is made is the ‘first declaration deferral
period’ for the purpose of section 8J.

Before
making a declaration that there are satisfactory contractual
arrangements relating to STS under proposed section 8J,
proposed subsection 8J(6) requires that there be in force a
contract with Telstra under clause 13 of the TUSMA Bill that
has been entered into by Telstra for a purpose relating to the
achievement of the policy objective in paragraph 11(a) of that
Bill (with respect to the supply of STS). There must be no notice
of termination given under this contract by either
party.

The
Minister must also be satisfied that Telstra, as the contracted
provider of standard telephone services at the time the Bill
commences, is likely to substantially comply with its contractual
obligations, having regard to the following criteria:

· the extent
to which Telstra has complied with its regulated STS obligations,
as set out in Parts 2 (Universal Service Regime) and 5
(Customer Service Guarantee) of the Consumer Protection Act (not
including any act, omission, matter or thing occurring before the
commencement of this proposed section)

· the extent
to which Telstra has complied with its contractual obligations
(under its contract with TUSMA) to supply STS

· the nature
of Telstra’s obligations under the contract, and

· any other
matters that the Minister considers relevant (for example, any
rectification plans or contract variations that have
occurred).

These
criteria are not intended to be exhaustive, and will not limit the
matters to which the Minister may have regard in making a
declaration. The Minister must also obtain advice from the ACMA
(regarding regulatory compliance) and TUSMA (regarding contractual
compliance) before making the declaration.

If the
Minister is satisfied that there are satisfactory alternative
contractual arrangements in place, the Minister will be able to
determine that the process for progressive removal of the USO for
the standard telephone service can proceed through the mechanisms
set out in proposed section 8H.

In
requiring the Minister to make a declaration under proposed
subsection 8J(1) no earlier than 18 months after commencement of
the section, this proposed section provides Telstra with at least a
full financial year of delivering the STS under the new contractual
arrangements before the Minister considers Telstra’s record
of compliance with its regulatory and contractual obligations, as
per proposed subsection 8J(6). The timeframe also allows
sufficient time for the ACMA and TUSMA to gather and analyse
relevant data about Telstra’s compliance in order to inform
the Minister’s decision.

Declarations
by the Minister under this proposed section are legislative
instruments and will be subject to disallowance, but they cannot
otherwise be varied or revoked.

Declaration
deferral periods

If the
Minister is not initially satisfied under proposed paragraph
8J(1)(c) that there are satisfactory alternative contractual
arrangements, the Minister will be required under
paragraph 8J(1)(d) to make a ‘first declaration deferral
period’ declaration. Such a declaration is also taken to have
been made if a declaration made under either proposed
paragraphs 8J(1)(c) or (d) is not in force at the later of
either 26 months after the commencement of subsection 8J(2) or
following the last day that a motion to disallow the declaration
could have been passed by a House of Parliament. This ensures a
declaration deferral period will apply where, for instance, an
initial declaration that there are satisfactory contractual
arrangements is disallowed by a House of Parliament.

The
Minister is provided with up to two ‘declaration deferral
periods’ (proposed paragraphs 8J(1)(d) and 8J(3)(b))
should the Minister decide not to declare that satisfactory
alternative contractual arrangements are in place relating to STS.
Each period has the effect of deferring consideration of whether
the STS part of USO regulation should be removed for an additional
period of up to 18 months. This would provide an opportunity for
Telstra to remedy any issues with its record of regulatory or
contractual compliance.

If, after
both the first and second declaration deferral periods are
declared, the Minister is still not satisfied that there are
satisfactory alternative contractual arrangements based on
Telstra’s performance against the criteria, the Minister is
required to declare (proposed paragraph 8J(5)(b)) that there
are no satisfactory alternative contractual arrangements in place.
If this happens, the regulatory obligations relating to the supply
of STS under the Consumer Protection Act will remain in force and
any arrangements regarding the removal of regulatory obligations
will only be able to occur with further Parliamentary
approval.

Proposed
subsection 8J(9) provides that a declaration under this
section cannot be varied or revoked. Since a declaration under this
section is a trigger for the removal or not of Telstra’s
regulatory obligations, it is important that there be certainty
regarding the validity of the declaration.

The
process for declaring designated STS areas - proposed section
8H

If the
Minister has declared that there are satisfactory alternative
contractual arrangements under proposed section 8J, the Minister
will be able to commence the progressive removal of regulation from
Telstra through the processes for the making of a ‘designated
STS area’ set out in proposed section 8H.

The term
‘designated STS area’ refers collectively to either a
‘non-fibre designated STS area’ or a ‘fibre
designated STS area’. As a consequence of a service area
being a ‘designated STS area’ (and in concert with
other amendments to this Bill - see item 72) the regulated
obligations for the supply of the STS will cease to apply to that
service area. In those areas, STS will be solely provided in
accordance with TUSMA’s contract with Telstra.

The
Minister must not declare a ‘non-fibre designated STS
area’ or a ‘fibre designated STS area’
unless:

· a final
migration plan is in force under subsection 577BE(3) of the
Telecommunications Act. The requirements for a final migration plan
are set out in subsection 577BC(2) of that Act;

· the
Minister has declared under proposed section 8J that, in the
Minister’s opinion, there are satisfactory alternative
contractual arrangements relating to standard telephone services;
and

· the
Minister has consulted with NBN Co.

In
addition, the Minister must not declare an area to be a non-fibre
designated STS area unless the Minister is satisfied that an NBN
corporation has not installed, is not installing, and does not
propose to install, optical fibre lines to premises in that service
area. In contrast, the Minister must not declare an area to be a
fibre designated STS area unless the Minister is satisfied that an
NBN corporation has installed, or is in the process of installing,
optical fibre lines to premises in that service area.

Consultation
with NBN Co will ensure that the Minister will be able to draw on
factual information from NBN Co as to those areas where it has, or
is in the process of, deploying fibre to premises, and its future
plans as to the areas where it intends to deploy fibre to premises
or alternatively use wireless or satellite infrastructure to
provide services. NBN Co will need to maintain detailed mapping and
premises information both to support the planning, construction and
maintenance of its fibre network, to advise access seekers as to
when services can be delivered in an area, and to regularly report
against the fibre coverage objective established by the Government.
It is expected that NBN Co will therefore draw on this pre-existing
information when the Minister consults with it on this
matter.

Proposed
subsections 8H(4) and 8H(8) ensure that a declaration for a
designated STS area cannot come into force unless an earlier
declaration of satisfactory alternative contractual arrangements
made under proposed section 8J has not been disallowed by a
House of Parliament.

Under
proposed subsection 8H(10), if the Minister has the power to make a
designated STS area declaration, the Minister must make the first
declaration for a designated STS area within 90 days of a
declaration of satisfactory alternative contractual arrangements
under proposed section 8J coming into force. Subsequently, the
Minister is required to consider making further declarations under
proposed section 8H at least once every six months, until any of
the following occurs:

· the
contract with Telstra for the provision of STS under clause 13
of the TUSMA Bill ceases to be in force

· if any of
the provisions of a final migration plan cease to have effect,
or

· the
Minister declares the NBN to be built and fully
operational.

Declarations
under proposed section 8H will not be legislative instruments.
Although declaring service areas as designated STS areas has the
consequential effect of removing regulatory obligations from those
areas, the instrumental declaration for removal is the initial
declaration under proposed section 8J that the Minister is
satisfied there are satisfactory alternative contractual
arrangements relating to the STS. It is this declaration which
enables the designated STS area declarations to be made.
Declarations under proposed section 8H rely on factual matters
(for example, whether or not NBN is installing optical fibre lines
to an area) and therefore are administrative in nature, and will
not be legislative instruments under section 5 of the LI
Act.

Although
declarations under proposed section 8H are not legislative
instruments, in the interests of transparency these declarations
are required to be published on the Department’s website
(proposed subsection 8H(13)).

Proposed
subsection 8H(14) stipulates that a declaration under this
section cannot be varied or revoked. This restriction avoids any
possible uncertainty as to whether or not the STS related
regulatory obligations have been removed from an area. Once a
declaration is made under section 8H with respect to a service
area, it will not be possible under the Consumer Protection Act for
the STS-related regulatory obligations to be reintroduced to that
area.

Proposed
section 8K sets out the process by which the Minister is
required to make declarations as to whether there are satisfactory
alternative contractual arrangements relating to payphones. This
process is similar to that relating to STS except that, unlike STS
for which there is a gradual removal of STS regulated USO as areas
are declared ‘designated STS areas’, once a declaration
has been made under proposed section 8K and not been disallowed (in
concert with item 76 of this Bill), the regulated obligation for
the provision of payphones immediately ceases to apply.

Proposed
subsection 8K(1) requires the Minister, after 18 months (but
no later than 23 months) from commencement of that subsection, to
make either of the following declarations:

· a
declaration that, in the Minister’s opinion, there are
satisfactory alternative contractual arrangements in relation to
payphones, or

· a
declaration that the 18-month period starting immediately after the
declaration is made is the first declaration deferral period for
the purpose of section 8K.

The
matters to be considered before determining satisfactory
alternative contractual arrangements for payphones are similar to
the criteria applying to the equivalent declaration for standard
telephone services under proposed section 8J. Namely, there
must be in force a contract with Telstra under clause 13 of
the TUSMA Bill that has been entered into by Telstra for a purpose
relating to the achievement of the policy objective in
paragraph 11(b) of that Bill (with respect to the supply of
payphones) and no notice of termination has been given under this
contract by either party.

The
Minister must also be satisfied that Telstra, as the contracted
provider in relation to the supply, installation and maintenance of
payphones at the time the Bill commences, is likely to
substantially comply with its contractual obligations, having
regard to the following criteria:

· the extent
to which Telstra has complied with its regulatory obligations in
relation to payphones, as set out under Part 2 of the Consumer
Protection Act (not including any act, omission, matter or thing
occurring before the commencement of this proposed
section)

· the extent
to which Telstra has complied with its contractual obligations
(under its contract with TUSMA) to supply, install and maintain
payphones

· the nature
of Telstra’s obligations under the contract, and

· any other
matters that the Minister considers relevant (for example, any
rectification plans or contract variations that have
occurred).

Similar to
proposed section 8J, the above criteria are not intended to be
exhaustive, and will not limit the matters that the Minister may
have regard to before making a declaration. The Minister must also
obtain advice from the ACMA (regarding regulatory compliance) and
TUSMA (regarding contractual compliance) before making the
declaration.

If the
required contractual arrangements are in place, and the performance
of Telstra in relation to its regulatory and contractual
obligations meets the criteria for making a declaration set out in
proposed subsection 8K(6), the Minister may make a declaration
that satisfactory alternative contractual arrangements are in place
for payphones, and the regulated obligation for provision of
payphones under paragraph 9(1)(b) and subsection 9(2A) is
consequentially lifted in all areas of Australia (see item
76).

In
requiring the Minister to make a declaration no earlier than 18
months after commencement of the section, the proposed section will
provide Telstra with at least a full financial year to supply,
install and maintain payphones pursuant to the new contractual
arrangements before the Minister considers Telstra’s record
of compliance with its regulatory and contractual obligations, as
per proposed subsection 8K(6). The timeframe also allows
sufficient time for the ACMA and TUSMA to gather and analyse
relevant data about Telstra’s payphones-related compliance in
order to inform the Minister’s decision.

Declarations
by the Minister under this proposed section are legislative
instruments and will be subject to disallowance by
Parliament. Proposed
subsection 8K(9) also provides that a declaration under this
section cannot be varied or revoked. As with declarations made
under sections 8H and 8J, there should be no uncertainty under
this section as to whether the Minister is satisfied that there are
satisfactory alternative contractual arrangements in relation to
payphones. A decision on this matter can only be made by the
Minister within the time period set out in this section.

Declaration
deferral periods

If the
Minister is not initially satisfied that there are satisfactory
alternative contractual arrangements relating to payphones, the
Minister will be required under paragraph 8K(1)(d) to make a
‘first declaration deferral period’ declaration. Such a
declaration is also taken to have been made if a declaration made
under either proposed paragraphs 8K(1)(c) or (d) is not in force at
the later of either 26 months after the commencement of
subsection 8K(2) or following the last day that a motion to
disallow the declaration could have been passed by a House of
Parliament. This ensures a declaration deferral period will apply
where, for instance, an initial declaration that there are
satisfactory contractual arrangements is disallowed by a House of
Parliament.

The
Minister is provided with up to two ‘declaration deferral
periods’ of up to 18 months each (proposed paragraphs
8K(1)(d) and 8K(3)(b)). After each deferral period, the Minister
can reconsider Telstra’s record of compliance with its
regulatory and contractual obligations and other relevant matters
set out in proposed subsection 8K(6), and make a further
declaration as to whether there are satisfactory alternative
contractual arrangements. The 18-month period between declarations
would provide Telstra with an opportunity to remedy any issues with
its record of regulatory or contractual compliance.

If, after
both the first and second declaration deferral periods are
declared, the Minister is still not satisfied that there are
satisfactory alternative contractual arrangements, the Minister is
required to make a declaration under proposed
paragraph 8K(5)(b) that no satisfactory alternative
contractual arrangements are in place in relation to payphones. If
this happens, the regulatory obligations relating to payphones
under the Consumer Protection Act will remain in force and any
arrangements regarding the removal of such obligations will only be
able to occur with further Parliamentary approval.

Item 72
- Paragraph 9(1)(a)

Item 75
- Subsection 9(2)

These
amendments are part of the package of amendments required to
transition the regulated universal service regime under the
Consumer Protection Act to the alternative contractual arrangements
provided for in the TUSMA Bill.

Section 9
defines the universal service obligation. It includes, in
paragraph 9(1)(a), the obligation to ensure that standard
telephone services are reasonably accessible to all people in
Australia on an equitable basis, wherever they reside or carry on
business in Australia.

Subsection
9(2) makes clear that the STS obligation includes the obligation to
supply STS to people in Australia on request.

Items 72
and 75 amend paragraph 9(1)(a) and subsection 9(2) with the
effect that the STS obligation will no longer apply to people in
‘designated STS areas’ (this term is defined in
proposed section 8H). The result of these amendments would be that
the regulated universal service STS obligation under this Act would
no longer apply to designated STS areas (areas declared by the
Minister under section 8H), on the basis that the Minister is
satisfied that there are satisfactory alternative contractual
arrangements in place in those areas for the STS (as declared under
proposed section 8J). While Telstra would still be providing the
STS in those designated areas under its contract with TUSMA, it
will no longer be subject to the regulated obligation to supply the
STS under section 9 in those designated areas.

The STS
obligation in paragraph 9(1)(a) and subsection 9(2) is replicated
as a policy objective in paragraph 11(a) of the TUSMA Bill. Clause
13 of that Bill enables TUSMA to enter into contracts (and/or
grants) to achieve the policy objectives. On 23 June 2011, the
Commonwealth announced it had entered into a contract with Telstra
relating, amongst other things, to achieving the policy objective
in paragraph 11(a). Clause 22 of the TUSMA Bill will deem this
contract to be a clause 13 contract under the TUSMA Bill provided
the contract has not been discharged, terminated or rescinded at
the time of commencement of clause 22. Under clause 12 of the
TUSMA Bill, TUSMA must also, in performing its functions and
exercising its powers, take all reasonable steps to ensure that the
policy objectives listed in clause 11 (including the standard
telephone service and payphone objectives that are modelled on the
USO provisions in the Consumer Protection Act) are achieved under
the contractual arrangements provided for in the TUSMA
Bill.

Item 73
- Paragraph 9(1)(b)

Item 74
- Paragraph 9(1)(c)

Item 77
- Subsection 9(2B)

The
universal service obligation includes, as per paragraph 9(1)(c),
the obligation to ensure that prescribed carriage services are
reasonably accessible to all people in Australia on an equitable
basis, wherever they reside or carry on business. Subsection 9(2B)
makes clear this obligation extends to the supply of prescribed
carriage services to people in Australia on request.

At the
commencement of the Bill, no services will have been prescribed
under section 9D of the Consumer Protection Act. Since the
universal service regime is being phased out and replaced with a
contractual framework, the ability to prescribe further carriage
services to be included as part of the USO is no longer necessary.
Therefore, items 74 and 77 repeal paragraph 9(1)(c) and subsection
9(2B) respectively and item 73 is a consequential
amendment.

The repeal
of the concept of ‘prescribed carriage services’ is
consequential to the inclusion of paragraph 11(f) of the TUSMA
Bill, which enables
new policy objectives for TUSMA to be specified under regulations
where these objectives relate to the supply of carriage
services . If the
regulations do specify further carriage services, this will enable
TUSMA to enter into contracts in relation to such services to
achieve the paragraph 11(f) policy objective.

Item 76
- After subsection 9(2A)

This
amendment is part of the package of amendments required to
transition the regulated universal service regime under the
Consumer Protection Act to the alternative contractual arrangements
provided for in the TUSMA Bill.

This item
inserts a proposed new subsection 9(2AA), which provides that
an obligation does not arise under paragraph 9(1)(b) or
subsection 9(2A) if the Minister makes a declaration under
section 8K that, in the Minister’s opinion, there are
satisfactory alternative contractual arrangements relating to
payphones, and that declaration has not been disallowed by a House
of Parliament.

The
universal service obligation includes, as per paragraph 9(1)(b),
the obligation to ensure that payphones are reasonably accessible
to all people in Australia on an equitable basis, wherever they
reside or carry on business. Subsection 9(2A) makes clear this
obligation includes the obligation to supply, install and maintain
payphones in Australia. ‘Payphone’ is defined in
section 9C to mean a fixed telephone that is a means by which
a STS is supplied and when in working order, generally cannot be
used to make a call unless payment or similar activation takes
place.

The effect
of proposed subsection 9(2AA) is that the regulated obligation to
supply, install and maintain payphones will cease to apply to all
people in Australia the day after a declaration under proposed
section 8K that there are satisfactory alternative contractual
arrangements relating to payphones comes into force. Proposed
subsection 8K(6) sets out the criteria which must be met before the
Minister can make such a declaration.

The result
of this amendment would be that, from the day after the
Minister’s declaration that there are satisfactory
alternative contractual arrangements relating to payphones comes
into effect (i.e. has been made and has not been subsequently
disallowed by a House of Parliament), Telstra will be providing for
payphones purely under its contractual arrangements with TUSMA and
it will no longer be subject to the regulated obligation to supply
payphones under section 9.

The
payphones obligation in paragraph 9(1)(b) and subsection 9(2A) is
replicated as a policy objective in paragraph 11(b) of the TUSMA
Bill. Clause 13 of that Bill enables TUSMA to enter into contracts
(and/or grants) to achieve the policy objectives. On 23 June 2011,
the Commonwealth announced it had entered into a contract with
Telstra relating, amongst other things, to achieving the policy
objective in paragraph 11(b). Clause 22 of the TUSMA Bill will deem
this contract to be a clause 13 contract under the TUSMA Bill
provided the contract has not been discharged, terminated or
rescinded at the time of commencement of clause 22. Under
clause 12 of the TUSMA Bill, TUSMA must also, in performing
its functions and exercising its powers, take all reasonable steps
to ensure that the policy objectives listed in clause 11
(including the standard telephone service and payphone objectives
that are modelled on the USO provisions in the Consumer Protection
Act) are achieved under the contractual arrangements provided for
in the TUSMA Bill.

Item 78
- Subsection 9(5)

Item 79
- Section 9A

Item 80
- Paragraph 9B(1)(b)

Item 81
- Paragraph 9B(1)(c)

These
amendments are consequential to the proposed removal of the concept
of prescribed carriage services from the universal service
obligation in section 9 and the repeal of
section 9D.

Subsection 9(5)
provides that an obligation does not arise under
paragraph 9(1)(c) and subsection 9(2B) in relation to
particular equipment, goods or services, the supply of which is
treated under section 9F as the supply of a prescribed
carriage service if the relevant customer requests not to be
supplied with the equipment, goods or services. Item 78 repeals
this provision.

Section 9A
enables the Minister to determine in writing, for the purposes of
paragraph 9(1)(c), what is, or is not, necessary to ensure
that prescribed carriage services are readily accessible. No
determination has so far been made by the Minister under
section 9A. Item 79 repeals this provision.

Paragraph 9B(1)(c)
provides that the obligation referred to in paragraph 9(1)(c)
(dealing with prescribed carriage services) is a ‘service
obligation’ (unless the Minister makes a determination under
subsection 9B(2) that divides the universal service obligation in
another way). Item 81 repeals this provision and item 80 is a
consequential amendment.

The repeal
of the concept of ‘prescribed carriage services’ is
consequential to the inclusion of paragraph 11(f) of the TUSMA
Bill, which enables new policy objectives for TUSMA to be specified
under regulations where these objectives relate to the supply of
carriage services. As TUSMA will have the capacity to take on
additional functions under that clause, the concept of
‘prescribed carriage services’ will no longer be
needed.

Item 82
- Section 9D

Section 9D
provides that, for the purposes of Part 2 of the Consumer
Protection Act, a prescribed carriage service is a carriage service
specified in the regulations. Item 82 repeals section 9D to remove
the concept of a prescribed carriage service from Part 2 of the
Act.

Section 9D
was introduced to provide a mechanism to cater for changes over
time in the development of the type of carriage services that may
become available, and to enable other such carriage services to be
made accessible under the universal service regime (if
appropriate). To date, no carriage service has been prescribed by
the Minister under section 9D.

With the
gradual phasing out and replacement of the universal service regime
under the Consumer Protection Act and the roll out of the National
Broadband Network, it is no longer necessary to retain the ability
to prescribe any further carriage services for the purposes of Part
2 of the Act. Further details regarding this amendment are provided
in the notes to items 73, 74 and 77.

Item 83 - Section 9F

This item repeals section 9F, which provides that a
reference in Part 2 of the Consumer Protection Act includes a
reference to the supply of customer equipment and other goods or
services (as specified in the regulations), where the equipment,
goods or services are for use in connection with the prescribed
service.

The repeal
of section 9F is a consequence of the repeal of
section 9D and the proposed removal of the concept of
prescribed carriage services from Part 2 of the Consumer Protection
Act.

Item 84 - Subsection 9G(1) (note)

Item 84 is a consequential amendment to the note to
subsection 9G(1) as a result of the amendments to section 9G
made by items 85 to 88.

Item 85 - Subsection 9G(3)

Subsection 9G(1) enables the Minister to determine universal
service areas in respect of one or more specified areas.

Subsection 9G(3) provides that if at any particular time any
areas of Australia are not within a universal service area covered
by a determination under subsection 9G(1), in respect of a
service obligation:

·
those areas together constitute at that time a single universal
service area in respect of that service obligation, and

·
the Minister is taken to have made a determination to that effect
under subsection 9G(1). That is, a determination that those
areas outside the determined universal services areas together
constitute a default service area.

Item 85 amends subsection 9G(3) by providing that the
subsection will not apply to areas in Australia that are in
‘designated STS areas’. This term is defined in
proposed subsection 8H(1). This amendment is a consequence of
the gradual phasing out and replacement of the universal service
regime from the Consumer Protection Act.

The effect of this amendment is that where a service area has been
designated by the Minister under proposed section 8H it cannot
be taken to have been determined by the Minister to be a single
‘universal service area’ for the purposes of section
9G.

Item 86 - Subsection 9G(3)

Item 87 - Paragraph 9G(4)(a)

Item 88 - Subsection 9G(5)

Subsection 9G(4) provides that if at any particular time one or
more of the universal service areas in respect of which the
Minister is taken to have made a determination because of
subsection (3) cover the same areas of Australia, then despite that
subsection:

·
those areas together constitute at that time a single universal
service area in respect of all the service obligations referred to
in that subsection, and

·
the Minister is taken to have made a determination under
subsection 9G(1).

This rule in subsection 9G(3) is intended to prevent an unnecessary
proliferation of default universal services areas in the event that
the Minister determines different service areas. To the extent that
the default service areas for the service obligations coincide but
that for a third does not, then the first two will have the same
default service area while the latter will have its own default
service area.

Items 86 and 87 amend subsection 9G(3) and paragraph 9G(4)(a)
so that these provisions only relate to the STS service
obligation.

Item 88 repeals subsection 9G(5) and inserts proposed new
subsections 9G(5) to (9). Proposed subsection 9G(5)
replicates subsection 9G(3) except that it only applies to the
payphone-related service obligation. Similarly, proposed subsection
9G(6) replicates subsection 9G(4) except that it only applies to
the payphone-related service obligation.

The need to differentiate between the STS and payphones service
obligations in section 9G is to allow for a situation where, for
example, the payphones USO ceases to apply to any universal service
area in Australia but the obligation to supply standard telephone
services still applies to universal service areas (other than
designated STS areas). Alternatively, a situation may arise where
the payphones USO still applies across Australia, but the gradual
removal of the obligation for STS has commenced in some areas. As
the Bill enables separate declarations to be made in relation to
the adequacy of the contractual arrangements for STS and payphones
(proposed sections 8J and 8K respectively), such variations are
possible. It is important to note, however, that Telstra will still
be subject to contractual obligations under the agreement with
TUSMA to supply the STS and payphones in areas where there is no
longer a regulated USO obligation.

Therefore the amendments recognise that, from the commencement of
the Bill, it is likely that different universal service areas will
apply to different parts of the service obligation, and that a
universal service provider may, for example, have a regulated
obligation to supply standard telephone services in a particular
service area under section 9, but no concurrent regulatory
obligation under section 9 to ensure that payphones are reasonably
accessible in that area.

Proposed subsections 9G(7) and (8) provide that a declaration
made in writing under subsection 9G(1) will be a legislative
instrument, but not a declaration deemed to have been made under
subsections 9G(3) or (4), or proposed subsection 9G(5) and
(6). However, for reasons of transparency, proposed
subsection 9G(9) will require the Minister to cause a
determination that he or she has been taken to have made under
section 9G to be published on the Department’s
website.

Item 89 - Subsection 12A(6)

Item 90 - Subsection 12D(2)

Item 91 - Subsection 12E(6)

Item 92 - Subsection 12E(7)

Items 89
to 92 are consequential amendments arising from the enactment of
the LI Act and the repeal of section 46A of the AIA effected by the
Legislative Instruments (Transitional Provisions and
Consequential Amendments) Act 2003 . The Legislative
Instruments (Transitional Provisions and Consequential Amendments)
Act 2003 did not amend the references to disallowable
instruments for the purposes of section 46A of the AIA in the
Consumer Protection Act at the time it repealed section 46A. To
accord with current terminology, these items replace references to
a ‘disallowable instrument for the purposes of section 46A of
the AIA’ with ‘legislative
instrument’.

Item 93 - Paragraph 18(2)(b)

Item 94 - Paragraph 18(2)(c)

Items 93 and 94 together amend subsection 18(2) by omitting
paragraph 18(2)(c). The effect of the amendment is to provide that,
for the purposes of Division 11 of the Consumer Protection
Act, which concerns the regulation of universal service charges, a
‘universal service charge’ does not refer to the supply
of prescribed carriage services to persons in a universal service
area.

These
items are consequential amendments arising from the proposed repeal
of section 9D and that the concept of prescribed carriage
services will no longer apply to Part 2 of the Consumer Protection
Act. The repeal
of the concept of ‘prescribed carriage services’ is
consequential to the inclusion of paragraph 11(f) of the TUSMA
Bill, which enables new policy objectives for TUSMA to be specified
under regulations where these objectives relate to the supply of
carriage services. As TUSMA will have the capacity to take on
additional functions under that clause, the concept of
‘prescribed carriage services’ will no longer be
needed.

Item 95
- Paragraph 20C(1)(a)

Item 96
- After subsection 20C(1)

Item 95
amends subsection 20C(1) with the effect that the last
‘eligible revenue period’ relating to the universal
service levy under the Consumer Protection Act will be the
2011-12 financial year. This means that no further assessment
of eligible revenue will be made by the ACMA under section 20F
after the 2011-12 financial year.

This
amendment reflects the change that from 1 July 2012, the universal
service levy will be replaced by the new industry levy to be
imposed by the Industry Levy Bill. To manage this transition, the
first eligible revenue period under the TUSMA Bill (which will also
be the financial year 2011-12) will rely on the eligible
revenue assessment by the ACMA under section 20F, for that same
period (see subclause 93(7) of the TUSMA Bill.)

Item 96 is
a consequential amendment as a result of the amendment made by item
95.

Item 97 - Subparagraph 106(1)(b)(ii)

Item 98 - Subsection 106(1)

Item 99 - Subparagraph 106(2)(c)(ii)

Item 100 - Subsection 106(2)

Item 101 - After subsection 106(3)

Items 97 to 101 replace all references to the universal
service obligation in section 106 with the term ‘universal
service purpose’. This term is defined in proposed new
subsection 106(3A).

Under proposed subsection (3A), a service is deemed to have
been supplied ‘for a universal service purpose’ only if
that service is supplied:

·
in fulfilment of the universal service obligation, as defined in
section 9 of the Consumer Protection Act, or

·
in compliance with the terms and conditions of a contract or grant
agreement entered into under clause 13 of the TUSMA Bill for a
purpose relating to the achievement of policy objective in
paragraph 11(a) of that Bill that standard telephone services
are to be reasonably accessible to all people in Australia on an
equitable basis, wherever they reside or carry on business and be
supplied to people in Australia on request.

Under section 104, a carriage service provider who charges an
eligible customer for eligible local calls made using a STS
supplied to that customer must give the customer an untimed local
call option for those calls. Section 106 defines an
‘eligible local call’ to include a call that is made
using a STS supplied to an eligible customer in fulfilment of the
universal service obligation. Upon the declaration by the Minister
of ‘designated STS areas’ under proposed new
section 8H of the Consumer Protection Act, the universal
service obligation to supply the STS will no longer apply with
respect to those areas. The amendments to section 106
therefore allow for an eligible local call to be defined regardless
of whether a particular customer is in an area that is still
subject to a universal service obligation under the Consumer
Protection Act or in an area where this obligation has been
removed, and services are being supplied under a contract or grant
that has been entered into under clause 13 of the TUSMA Bill to
fulfil the STS policy objective (paragraph 11(a) of the TUSMA
Bill).

These important amendments provide continuity and ensure that
customers to which section 106 applies will continue to be
provided with an untimed local call option notwithstanding the
gradual phasing out of the STS universal service obligation set out
in Part 2 of the Consumer Protection Act.

Item 102 - Subparagraphs 109(1)(a)(i), (b)(i),
(c)(i) and (d)(i)

Item 103 - At the end of section 109

Item 102 amends section 109 by extending the operation of that
section to apply to both ‘universal service
contractors’ and ‘universal service grant
recipients’. Item 103 defines these terms in proposed new
subsections 109(4) and (5). Section 109 defines an
‘applicable zone’ for the purposes of Part 4 of
the Consumer Protection Act. The ‘applicable zone’ is
the zone within which calls are ‘local’ calls. The
default ‘applicable zone’ is the relevant
‘standard zone’ in which that customer is situated.
However, a different ‘nominated area’ may currently
apply in the following circumstances:

·
if the provider is the universal service provider for that
customer, where the provider nominates a different zone to the ACMA
and the customer chooses to adopt the nominated area,
and

·
if the provider is not a universal service provider, where the
provider nominates a different zone to the ACMA (whether or not the
customer chooses to adopt the nominated area).

A ‘universal service provider’ is defined in
section 11A to mean a primary universal service provider or
competing universal service provider. However, upon the declaration
by the Minister of ‘designated STS areas’ under
proposed new section 8H of the Consumer Protection Act, the
obligations of primary or competing universal service providers
under that Act will no longer apply with respect to the designated
STS areas.

Proposed subsection 109(4) provides that a provider is a
‘universal service contractor’ if a customer of the
carriage service provider is in a particular area, and the provider
is a contractor in relation to a contract entered into under
clause 13 of the TUSMA Bill in fulfilment of the STS-related
policy objective in paragraph 11(a) of that Bill and the
contract imposes an obligation on the contractor to supply standard
telephone services in the area. Proposed subsection 109(5) provides
a similar definition for a universal service grant recipient but in
relation to a grant of financial assistance made under clause 13
rather than a contract.

The effect of these combined amendments is to ensure that where
providers that fulfil the STS policy objective through a contract
or grant agreement entered into under clause 13 of the TUSMA
Bill nominate a different zone to the ACMA and the relevant
customers choose to adopt the nominated areas, the nominated areas
will become ‘applicable zones’ for the purposes of
section 109.

These amendments provide important continuity for customers to
which section 109 applies, notwithstanding the gradual phasing out
of the STS universal service obligations set out in Part 2 of the
Consumer Protection Act.

Item 104 - Subsection 120(7)

Subsection 120(7) provides that a customer cannot waive their
CSG protections and rights, in whole or in part, under Part 5 of
the Consumer Protection Act for services supplied, or proposed to
be supplied, in fulfilment of the USO.

Item 104 amends subsection 120(7) with the effect that the
prohibition on waiver by a customer will also apply if the services
are supplied, or proposed to be supplied in compliance with the
obligations of a contract, or the terms and conditions of a grant,
entered into under clause 13 of the TUSMA Bill in fulfilment
of the STS policy objective in paragraph 11(a) of that
Bill.

This
amendment provides important continuity
for consumers. R egardless of whether the consumer is
receiving an STS from a universal service provider regulated under
Part 2 of the Consumer Protection Act or from a provider pursuant
to a contract or grant of financial assistance under clause 13
of the TUSMA Bill in fulfilment of the
STS policy objective in paragraph 11(a) of that Bill, a
standard telephone service cannot be provided on the condition that
the customer waives his or her CSG rights.

Item 105 - Paragraph 136(2)(b)

Part 7 of the Consumer Protection Act operates to protect
standard residential customers from losing prepaid monies if a new
carriage service provider fails to supply standard carriage
services, for example, due to the insolvency of the provider.
Section 136 provides that, for the purposes of Part 7, a
residential customer receiving a STS is a ‘standard
residential customer’, and the service is a ‘standard
carriage service’. Currently under subsection 136(2),
public mobile telephone services are excluded from section 136
but only if, as provided for in paragraph 136(2)(b), those services
are not supplied in fulfilment of the universal service
obligation.

Item 105 extends paragraph 136(2)(b) with the effect that public
mobile telephone services will also be excluded from section 136 if
the service is not supplied to the customer through a contract or
grant agreement entered into under clause 13 of the TUSMA Bill
in fulfilment of the paragraph 11(a) STS policy objective. This
amendment is consequential and intended to preserve the exception
set out in subsection 136(2) as the transition of provision of
the STS gradually moves from regulated obligations under Part 2 of
the Consumer Protection Act, to the contractual arrangements with
TUSMA (see
proposed new sections 8H-8K of the Consumer Protection Act
for the progressive removal of regulation under the universal
service regime).

Item 106 - After subsection 147(9)

Section 147 requires the ACMA to make a determination that
sets out requirements to be imposed on carriers, carriage service
providers and emergency call persons in relation to the provision
of emergency call services. For example, the determinations may
include requirements concerning the transmission of calls and
requirements regarding the receiving and handling of emergency
calls.

Subsection 147(9) currently provides that before making an
emergency call service determination under section 147, the
ACMA must consult certain persons. Item 106 inserts a proposed
new subsection 147(9A) which will also require the ACMA to
consult with TUSMA before making a determination under section
147.

This amendment reflects that from the commencement of the TUSMA
Bill, TUSMA will be responsible for the management of any contract
or grant agreements entered into under clause 13 of the TUSMA
Bill in fulfilment of the paragraph 11(c) policy objective relating
to the provision of an emergency call service. Therefore it is
appropriate that TUSMA be consulted by the ACMA prior to it making
an emergency call service determination under
section 147.

At commencement of Parts 1 and 2 of the Bill, the management
of the contract with Telstra for the provision of an emergency call
service will be transferred to TUSMA under clause 24 of the TUSMA
Bill. Thereafter TUSMA will assume management of the contract,
including monitoring of performance under clause 29 of the TUSMA
Bill and making payments to Telstra under the contract.

However, due to the nature and importance of emergency call
services, provisions for regulation of the emergency call service
will not be removed from the Consumer Protection Act. Any
contractors or grant recipients under clause 13 of the TUSMA Bill
in relation to the paragraph 11(c) policy objective will be
required to comply with any ACMA determinations regarding the
emergency call service.

Telecommunications
(Universal Service Levy) Act 1997

Item 107
- At the end of section 6

This item
inserts at the end of section 6 of the Telecommunications
(Universal Service Levy) Act 1997 a note providing that the
last ‘claim period’ for the purposes of the universal
service levy provided by that Act will end on or before
30 June 2012.

From
1 July 2012, it is intended that the USO and NRS levies
will be replaced by a single levy imposed by the Industry Levy
Bill. Part 6 of the TUSMA Bill concerns the assessment, collection
and recovery of the new industry levy.

Despite
2011-12 being the last financial year for which the USO levy
is payable, existing provisions that enable the ACMA to assess and
collect the USO levy under Part 2 of the Consumer Protection Act
will continue to apply. This ensures a smooth transition from the
existing USO and NRS levy schemes to the new industry levy scheme
(under the Industry Levy Bill and Part 6 of the TUSMA
Bill).

Items 108
and 109 are consequential amendments to section 473.1 of the
Criminal Code as a result of the proposed transition of the NRS
contracts from the Consumer Protection Act to the TUSMA
Bill.

Current
contracts for the provision of the NRS will continue to operate but
under TUSMA’s management as from 1 July 2012 (see clause 25
of the TUSMA Bill).

Item 108
is a consequential amendment resulting from the definition of the
‘National Relay Service’ being moved from the Consumer
Protection Act to the TUSMA Bill, noting TUSMA’s proposed
role in ensuring, as per its policy objective set out in paragraph
11(d) of the TUSMA Bill, that the National Relay Service is to be
reasonably accessible to all persons in Australia who are deaf or
have a hearing and/or speech impairment, wherever they reside or
carry on business. Consequently, other provisions relating to the
provision of the NRS under the Consumer Protection Act are also
being amended (see items 113 to 121 of this Bill).

Item 110
makes a proposed change to subsection 474.17(2) to make it
clear for the purposes of the subsection 474.17(1) offence
that more than one person can provide NRS services.

NRS Levy
Imposition Act 1998

Item 111 -
At the end of section 3

This
item inserts at the end of section 3 a note that NRS
contribution amounts are calculated for a quarter and that the last
quarter will end on 30 June 2012.

From
1 July 2012, it is intended that the USO and NRS levies
will cease to apply and will both be replaced by a single levy
imposed by the Industry Levy Bill. Part 6 of the TUSMA Bill
concerns the assessment, collection and recovery of the new
industry levy.

This note
brings to the attention of the reader that the quarter ending
30 June 2012 will be the last quarter for the purposes of
NRS liability under section 98 of the Consumer Protection
Act.

Item 112 amends the
simplified outline in section 4 by providing that
the NRS provisions in the Consumer Protection Act are to be
replaced by alternative contractual arrangements under the TUSMA
Bill. The
inclusion of these words in the outline is to bring to the
reader’s attention that the NRS provisions are being
transitioned from the Act to the TUSMA Bill.

The existing NRS contracts will be transferred to TUSMA under
clause 25 of the TUSMA Bill.

Part 3 of the Consumer Protection Act - The NRS
Levy

Items 113 to 121 of the Bill amend Part 3 of the Consumer
Protection Act which provides for the National Relay Service (NRS).
Through this Bill and the proposed TUSMA Bill, transitional
provisions will apply the new legislative scheme to existing NRS
contracts entered into by the Commonwealth prior to
commencement.

At commencement, clause 25 of the TUSMA Bill will provide that all
NRS contracts entered into under section 95 of the Consumer
Protection Act will be taken to have been entered into under clause
13 of the TUSMA Bill for a purpose relating to the paragraph 11(d)
NRS policy objective. The changes to the NRS scheme set out in
items 113 to 121 are intended to allow TUSMA, from the
commencement of the Bill, to take over management of the NRS
contracts by replacing the existing NRS scheme in the Consumer
Protection Act with the contractual framework set out in the TUSMA
Bill. However, the amendments to this Part of the Consumer
Protection Act are in no way intended to alter or detract from the
overarching policy objective in Part 3 that the NRS provide persons
who are deaf or who have a hearing and/or speech impairment with
access to a STS on terms, and in circumstances, that are comparable
to the access other Australians have to a STS. Nor is it intended
for there to be any substantive change to the level of performance
monitoring and reporting that currently applies to NRS
providers.

Item 113 - Section 93

The
simplified outline at section 93 is amended to clarify that the NRS
provisions in Part 3 of the Consumer Protection Act will be
replaced by alternative contractual arrangements under the TUSMA
Bill.

Item 114 - Section 94 (definition of NRS service
plan )

This item repeals the definition of ‘NRS service
plan’ in section 94. This amendment is a consequence of
the repeal of subsections 95(2) and (3) in item 116 of
the Bill, which provide for the NRS provider to prepare service
plans for the NRS.

Item 115 - After subsection 95(1)

This item inserts a proposed new subsection 95(1A) to ensure
that no further NRS contracts may be entered into under the
Consumer Protection Act after the commencement of the
subsection.

After the
commencement of the Bill any future NRS contracts (or grants) will
be entered into by TUSMA (on behalf of the Commonwealth) under
clause 13 of the TUSMA Bill. Any future NRS contracts or
grants will need to be in fulfilment of the NRS policy objective in
paragraph 11(d) of Part 2 of the TUSMA Bill which, similar to
paragraph 95(1)(a), provides that the National Relay Service
is to be reasonably accessible to all persons in Australia who are
deaf or have a hearing and/or speech impairment, wherever they
reside or carry on business.

On 24 June
2011, the ACMA announced it had extended its contract arrangements
with Australian Communication Exchange Limited and WestWood Spice
respectively to 30 June 2013 for provision of the National Relay
Service. However, the validity of any existing NRS contracts at the
time the Bill commences will not be affected by proposed
subsection 95(1A). Instead, clause 25 of the TUSMA Bill will
deem such contracts to have been entered into under clause 13 for a
purpose relating to the paragraph 11(d) NRS policy objective to
enable the existing NRS contracts to be managed by
TUSMA.

Item 116
- Subsections 95(2) and (3)

Item 16
repeals subsections 95(2) and (3) to remove any further
requirement for both the NRS provider to prepare service plans, and
for those service plans to be published by the Minister.

Under
the TUSMA Bill, there will be no specific requirement for the party
contracted in relation to the NRS policy objective to prepare
service plans. Instead, that will be a contractual matter between
TUSMA and the contractor or grant recipient. However, subclause
15(2) of the TUSMA Bill will enable the Minister to determine
standards, rules and/or minimum benchmarks that must be complied
with or met under future contracts for the NRS (however, this power
would not be exercisable in relation to the current NRS contracts).
Such rules could include, for example, performance standard and
benchmarks, , timetables for the provision of services, mechanisms
for dealing with complaints, reporting mechanisms and the like.

Additionally, under clauses 27 and 28 of the TUSMA Bill, key terms
and details of TUSMA contracts and grants under clause 13 of the
TUSMA Bill in fulfilment of the policy objectives of clause 11 of
the TUSMA Bill are to be maintained on public registers accessible
from TUSMA’s website.

Item 117
- After subsection 97(2)

Item 118
- Subsection 97(5)

Subsection 97(1)
requires the ACMA to monitor all significant matters relating to
the performance by each NRS provider of the provider’s
obligations under a NRS Service Plan. Subsection 97(2)
requires the ACMA to give a written report to the Minister at the
end of each financial year about the performance by each NRS
provider of the provider’s obligations under a NRS Service
Plan.

Item 117
inserts a proposed new subsection 97(2A), which provides that
subsections 97(1) and (2) do not apply to an obligation of a
NRS provider if that obligation arises after the commencement of
subsection (2A).

After commencement of the TUSMA Bill, TUSMA rather than the ACMA
will have the role of monitoring and reporting on the performance
of contractors and grant recipients (including NRS providers) under
clause 29 of the TUSMA Bill. TUSMA will also be required to submit
an annual report to the Minister under clause 75 of the TUSMA
Bill.

Item 118 amends the definition of ‘financial year’
for the purposes of section 97 with the effect that the last
financial year for which the ACMA has to provide a written report
to the Minister about the performance of each NRS provider is in
relation to the 2011-12 financial year.

Item 119 - At the end of section 97

This item inserts a proposed new subsection 97(6) to
provide that, for the purposes of section 97, a ‘NRS
service plan’ is a plan:

(a)
referred to in subsection 95(2), as in force prior to the
commencement of subsection (6), or

(b)
prepared before the commencement of that subsection.

This amendment is effectively a savings provision to make clear
what is being referred to as a ‘NRS service plan’ in
section 97, given that from the commencement of proposed
subsection 97(6) the definition of ‘NRS service
plan’ in section 94 and the requirement to prepare service
plans in subsection 95(2) will both have been repealed.

Item 120 - Section 98

This item amends section 98 with the effect that the NRS levy
is only payable up to and including the last quarter for the
2011-12 financial year.

From 1 July
2012, no liability will be incurred for the USO or NRS levies and
instead these levies will be replaced by a new industry levy to be
imposed by the Industry Levy Bill. Part 6 of
the TUSMA Bill concerns the assessment, collection and recovery of
levy, and outlines the role of the ACMA in making eligible revenue
assessments for the purpose of assessing the levy to be imposed by
the Industry Levy Bill.

Despite
2011-12 being the last financial year for which the NRS levy
is payable, the ACMA will still be able to recover as a debt any
unpaid NRS levy under subsection 101(1), and penalties for
late penalty of NRS levy under section 101A will continue to
apply.

Item 121 - Subsection 102(3)

Item 121 repeals subsection 102(3) and inserts a proposed new
subsection (3) which defines the purpose of the NRS Account as
being the payment of amounts payable by the Commonwealth under a
contract or grant entered into under clause 13 of the TUSMA
Bill in fulfilment of the NRS policy objective set out in
paragraph 11(d) of that Bill.

Currently, the NRS Account in section 102 is stated to have the
purpose of making payments to NRS providers under NRS contracts.
From 1 July 2012, however, the management of existing NRS contracts
will be transferred over to TUSMA (clause 25 of the TUSMA Bill) and
subsequent payments made to NRS providers under the NRS contracts
will be made by TUSMA pursuant to contracts or grants entered into,
or taken to have been entered into, under clause 13 of the
TUSMA Bill. The new purposes provision in subsection 102(3)
reflects the transfer to TUSMA of responsibility for the management
of NRS contracts.

A note at the end of subsection 102(3) assists the reader by
referring to section 21 of the FMA Act. Subsection 21(1)
provides that if an Act other than the FMA Act establishes a
Special Account and identifies the purposes of that Account, then
the Consolidated Revenue Fund is appropriated for expenditures of
the identified purposes of that Account.

Part 3
- Transitional

Item 122
- Transitional - NRS policy objectives

This item
provides that clause 12 of the TUSMA Bill does not apply before the
commencement of Part 2 of this Schedule (dealing with the NRS), in
relation to TUSMA’s NRS policy objective set out in paragraph
11(d) of the TUSMA Bill. Clause 12 of the TUSMA Bill requires TUSMA
to take all reasonable steps to ensure the policy objectives in
clause 11 are achieved.

This item
ensures that TUSMA’s obligation in clause 12 does not apply
to the NRS policy objective until the management of the NRS
contracts are transitioned to TUSMA at the commencement of Part 2
of the Schedule to this Bill.

Item 123
- Transitional - regulations

Item 123
enables the Governor-General to make regulations in relation to
transitional matters arising out of the amendments made by this
Schedule to the Bill. This item provides the Government with the
flexibility to address any unforeseen matters that may arise in the
process of transitioning the current universal service regime to
the TUSMA contractual framework.